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The Impact of the New OMB Uniform Guidance on Federal Grant Recipients.

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Presentation on theme: "The Impact of the New OMB Uniform Guidance on Federal Grant Recipients."— Presentation transcript:

1 The Impact of the New OMB Uniform Guidance on Federal Grant Recipients

2 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 2 Uniform guidance background ► OMB created the Council on Financial Assistance Reform (COFAR) in 2011 ► Co-chaired by the OMB-it includes the eight largest federal grant making agencies as well as one rotating member ► In late 2011, COFAR developed potential reforms to streamline and improve policies for federal grant funds

3 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 3 Uniform guidance background (cont.) ► OMB issued Advanced Notice of Proposed Guidance on February 24, 2012 ► OMB issued Proposed OMB Uniform Guidance: Cost Principles, Audit, and Administrative Requirements for Federal Awards ► Over 300 comment letters were received in the aggregate

4 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 4 OMB Revisions to its Grant Guidance ► 2 CFR Chapter I and Chapter II Parts 200, 215, 220, 225 and 230, Uniform Administrative Requirements, Cost Principles and Audit Requirements for Federal Awards (Uniform Guidance) ► Issued on December 26, 2013 ► Streamlines and consolidates eight existing OMB Circulars into one document

5 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 5 COFAR Q and A document ► FAQ #1 for New Uniform Guidance at 2 CFR 200 issued in February 2014 ► Should is not a presumptively mandatory requirement like it is in audit guidance but a “best practice” in the context of the Uniform Guidance

6 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 6 OMB uniform guidance objectives ► Streamline guidance for federal awards to ease administrative burden ► Strengthen oversight over federal funds to reduce risks of waste, fraud and abuse ► Focus grant policies on areas that emphasize the achievement of better grant outcomes at a lower cost while ensuring the financial integrity of taxpayer dollars

7 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 7 Effective dates ► Effective for awards or increments of awards issued after December 26, 2014 ► Could be challenging for auditees that will have awards within a particular fiscal year that are subject to the existing guidance and the new uniform guidance ► The audit requirements in Subpart F are effective for fiscal years beginning on or after December 26, 2014 ► Early implementation is not permitted!

8 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 8 OMB uniform guidance — streamlining of related circulars and guidance ► A-21,Cost Principles for Educational Institutions ► A-87, Cost Principles for State, Local and Indian Tribal Governments ► A -89, Federal Domestic Assistance Program Information ► A-102, Awards and Cooperative Agreements with State and Local Governments ► A-110, Uniform Administrative Requirements for the Awards and Other Agreements with Institutions of Higher Education, Hospitals and Other Nonprofit Organizations

9 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 9 OMB uniform guidance — streamlining of related circulars and guidance (cont.) ► A-122, Cost Principles for Non-Profit Organizations ► A-133, Audits of States, Local Governments and Non- Profit Organizations ► A-50, Audit Follow Up, related to single audits

10 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 10 Organization of Uniform Guidance by subpart ► A: Acronyms and Definitions ► B: General Provisions ► C: Pre-Federal Award Requirements and Contents of Federal Awards ► D: Post Federal Award Requirements ► E: Cost Principles ► F : Audit Requirements ► Appendices

11 © 2013 EYGM Limited. 2013 Circular A-133 Compliance Supplement and proposed circulars’ revision update Slide 11 Key changes for grant recipients - pre and post award administrative requirements

12 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 12 Administrative requirements ► The Uniform Guidance consolidates administrative requirements of OMB Circulars A-102 and A-110 into a uniform set of administrative requirements for all federal award recipients ► A-110 appears to have been adopted except for procurement which originates from A-102 and which is less flexible

13 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 13 Pass-through entity responsibilities ► While many of these responsibilities are implicit today or contained in the current OMB Circular A-133 audit requirements the OMB grant guidance more clearly enumerates them ► Expansion of pass-through entity responsibilities ► Must provide certain information in sub awards at the time of the federal award and with each annual continuation of the sub award ► Must provide for indirect costs of recipient ► Either negotiated or a flat rate of 10%

14 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 14 Pass-through entity responsibilities ► Pass-through entities are expected to refocus their efforts, particularly in documenting risk assessments of subrecipients for purposes of determining the nature, timing and extent of monitoring procedures ► Extent and results of federal awarding agency monitoring ► Prior experience with similar sub awards ► Results of previous audits ► Whether subrecipient has new personnel or systems

15 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 15 Key changes for grant recipients — administrative requirements ► Must have effective internal controls over compliance with federal awards ► Should comply with the internal control requirements issued by the Governmental Accountability Office (GAO) in Standards for Internal Control in the Federal Government also known as the “Green Book” and the Committee of Sponsoring Organizations of the Treadway Commission (COSO) in the Internal Control Integrated Framework ► Internal controls over compliance requirements moved from OMB Circular A-133

16 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 16 Internal controls over compliance with federal awards ► Part 6 of the OMB Circular A-133 Compliance Supplement contains a framework for internal control over compliance with federal awards that include suggested internal controls for each of the five elements of the COSO framework for each of the A-N compliance requirements ► However, this compliance supplement has historically been considered a document that helps auditors as opposed to explicit internal control criteria for recipients

17 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 17 COFAR FAQ #1— internal controls clarification ► There is no expectation or requirement that the recipient document or evaluate internal controls prescriptively in accordance with COSO or the Green Book or that the recipient or auditor reconcile technical differences between them ► COSO and Green Book are provided solely to alert recipients to source documents for best practices

18 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 18 Green Book ► The Green Book comment period ended on February 15, 2014 ► The Green Book is essentially an adaptation of the 5 components and 17 principles of COSO to the federal government and now the potentially broader recipient community as a best practice document for internal controls over compliance

19 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 19 Definition of internal control ► Green Book Internal control is an integral component of an entity’s management that provides reasonable assurance that the objectives of an entity are being achieved. These objectives and related risks can be broadly classified into one or more of the three following categories: ► Operations - effectiveness and efficiency of operations ► Reporting - reliability of reporting for internal and external use ► Compliance - compliance with applicable laws and regulations Internal control comprises the plans, methods, policies, and procedures used to fulfill the mission, strategic plan, goals, and objectives of the organization. Internal control serves as the first line of defense in safeguarding assets. In short, internal control helps federal managers achieve desired results through effective stewardship of public resources.

20 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 20 Codification of internal control concepts into principles and attributes ► Management uses internal control to help the organization achieve its mission and objectives ► Green Book approaches internal control through a hierarchical structure of five components supported by 17 principles, and relevant attributes that represent characteristics associated with each principle. Attributes are further elaborated on in elements. ► The codification represents the fundamental concepts associated with each component ► Provides a basis for developing, maintaining and evaluating the effectiveness of internal control

21 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 21 Five components of internal control Control Environment The foundation for an internal control system. It provides the discipline and structure to help an entity achieve its objectives. Control Activities The actions management control system, which includes the entity’s information system. establishes through policies and procedures to achieve objectives and respond to risks in the internal control system, which includes the entity’s information system. Information and Communication The quality information management uses to support the internal control system. Communicating quality information is vital for an entity to run and control its operations. Monitoring Assesses the quality of performance over time and ensures that the findings of audits and other reviews are promptly resolved. Risk Assessment Assesses the risks facing the entity as it seeks to achieve its objectives. This assessment provides the basis for developing appropriate risk responses.

22 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 22 Codification of 17 principles Control Environment 1Demonstrates commitment to integrity and ethical values 2Exercises oversight responsibility 3Establishes structure, responsibility and authority 4Demonstrates commitment to competence 5Enforces accountability Risk Assessment 6Define objectives and risk tolerances 7Identify, analyze, and respond to Risk 8Assess fraud risk 9Identify, analyze and respond to change Control Activities 10 Design control activities 11 Design activities for the information system 12 Implement control activities 13Uses quality information 14Communicates internally 15Communicates externally Monitoring Activities 16Perform monitoring activities 17Remediate deficiencies Information & Communication Attributes Elements Attributes Elements Attributes Elements Attributes Elements Attributes Elements 1455 10 37 11 41 7 27 620

23 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 23 Key changes for grant recipients — administrative requirements ► Agency review of the merits of proposals and risk proposed by applicants ► Announcement of funding opportunities ► Generally made available for at least 60 days ► Standard format to e used ► Interest earned on advances ► Threshold to remit interest increased to $500, can be remitted annually and to only one federal agency-HHS

24 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 24 Key changes for grant recipients — administrative requirements (cont.) ► Property standards ► Equipment no longer needed for the federal program it was purchased for can be used to support other programs ► The term contractors replaces vendors ► Could cause confusion in subrecipient relationships that use a “contract “ to pass funds down ► Look at nature of the relationship and not the name of the document ► Using a contract does not make someone a contractor

25 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 25 Key changes for recipients - cost principles

26 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 26 Cost principles ► OMB Circulars A-21, A-87 and A-122 consolidated into one. ► United States Department of Health and Human Services Cost Principles for Hospitals at 45 CFR Part 74 Appendix E-not incorporated in the Uniform Guidance ► OMB will conduct further review of the cost principles for hospitals to determine whether they should be added

27 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 27 Key changes for grant recipients — cost principles ► Indirect costs ► Entities are given the option of extending the negotiated rate for up to four years with the approval of the appropriate indirect cost cognizant agency ► A minimum rate of 10% of modified total direct costs is established to ensure that entities that are not able to negotiate receive a minimum reimbursement ► Pass-through entities will have to honor the indirect cost rates negotiated at the federal level, negotiate a rate in accordance with federal guidelines or provide a minimum flat rate

28 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 28 Compensation for personal services — current state ► Significant differences in time and effort documentation requirements under the three existing cost circulars ► A-21 is based on estimates that produce a reasonable estimation of actual activity ► A-87 and A-122 are based on periodic (at least monthly) time and effort reporting of employees

29 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 29 Compensation for personal services ► Uniform guidance provides less prescriptive guidance on documentation and increases emphasis on internal controls

30 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 30 Compensation for personal services (cont.) ► Time and effort reporting ► Focus is on broad principles of how an entity may establish internal controls to validate personnel related costs ► Less prescriptive guidance on documentation ► Entities will be allowed to document personnel costs by using performance-based reporting based on milestones rather than time and effort reports ► This new option could significantly reduce the administrative burden of documenting positions funded by multiple grants that essentially serve the same population of program participants

31 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 31 Time and effort reporting ► Charges to federal awards for salaries and wages must be based on records that accurately reflect the work ► Certification periods up to 12 months must be established to provide oversight of federal awards ► Budget estimates made before services are performed do not qualify a support but may be used for interim accounting purposes in certain circumstances

32 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 32 Key changes for grant recipients — cost principles ► Collection of improper payments ► Allowed to keep amounts collected to cover the expense of collection efforts ► Contingency provisions ► Cost accounting disclosure statement ► Increase in threshold to file to $50,000,000 ► Depreciation ► Restrictions on recovery of indirect costs for depreciation or use allowance

33 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 33 Key changes for grant recipients — cost principles (cont.) ► Idle facilities and idle capacity ► Costs associated with excess or idle capacity will be allowable costs ► Intangible assets ► Updates cost principles to treat intangible assets such as computer software capitalized in accordance with US GAAP similar to other fixed assets

34 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 34 Key changes for grant recipients — cost principles (cont.) ► Material and supply costs ► Cost of computing devices not otherwise subject to inventory controls will be considered allowable direct cost supplies ► Guidance sets a threshold of the lesser of $5,000 or the grantees capitalization policy minimum ► Utility costs ► Allows a utility cost adjustment of up to 1.3% to be included in the negotiated indirect cost rate for all institutions of higher education in accordance with two options for utility cost reimbursement

35 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 35 OMB uniform grant guidance — next steps for recipients ► Read the uniform grant guidance ► Including upcoming Q and A document to be issued ► Develop an internal implementation and training plan ► Identify changes to policies and procedures and internal controls to comply ► Familiarize yourself with COSO and the Green Book

36 The Impact of the New OMB Uniform Guidance on Federal Audit Requirements

37 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 37 OMB uniform guidance — single audit thresholds ► Raises the threshold of annual federal expenditures that triggers an A-133 audit from $500,000 to $750,000 ► Will provide audit relief for approximately 6,000 entities while approximately 99% of the federal expenditures subject to audit will still be covered under the increased threshold

38 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 38 OMB uniform guidance — changes to the major program determination process ► Minimum Type A program threshold increased from $300,000 to $750,000 for entities with annual expenditures less than $25 million ► Change in the tiered scale to determine Type A programs for entities with annual federal expenditures exceeding $25 million ► If total federal awards expended are between $25 million and $100 million then the Type A program threshold is.03 of federal awards expended

39 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 39 Changes in Type A program threshold ► If total federal awards expended are between $100 million and $1 billion then the Type A program threshold is $3 million ► If total federal awards expended are between $1 billion and $10 billion then the Type A program threshold is.003 of total federal awards expended ► If total federal awards expended are between $10 and $20 billion then the Type A program threshold is $ 30 million ► If total federal awards expended are $ 20 billion or more then the Type A program threshold is.0015 of total federal awards expended

40 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 40 Effect of loan programs on Type A program threshold ► Incorporates the guidance on large loans/loan guarantee programs that is currently in the OMB Circular A-133 Compliance Supplement ► However, modifies the guidance as it relates to a cluster of programs ► When loan program is less than 50% of the cluster that the loan program is included in the cluster is not considered a loan program, so all amounts would be included in the Type A program threshold calculation

41 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 41 Effect of loan programs on Type A threshold — part of a cluster ► Community colleges or entities where Pell and Work Study dominate the Student Financial Assistance Cluster such that the loan component of the cluster is less than 50%, will see an increase in the Type A threshold and likely less major programs will have to audited

42 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 42 Type A high risk programs ► The criteria for prior-year findings that make a Type A program high risk in the current year has been narrowed to only findings that either: ► Caused the program to not receive an unmodified compliance opinion ► Were material weaknesses in internal control over compliance ► Represented known or likely questioned costs exceeding 5% of the program’s expenditures

43 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 43 Type A high risk programs (cont.) ► If a Type A program has not been audited as a major program in 1 of the 2 most recent audit periods, it will still be a high-risk program and have to be audited as major ► A Type A program that had a significant deficiency in the prior year is no longer an automatic high risk program ► A Type A program that had a reportable compliance finding in the prior year that did not result in a modified compliance opinion nor known or likely question costs that exceeded 5% of the expenditures of the program is no longer an automatic high risk program

44 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 44 Change in default criteria for a Type A high - risk program ► This change focuses risk assessment on whether program received a modified opinion on compliance, had material known or likely questioned costs or a material weakness rather than virtually all types of findings, including those that are less significant

45 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 45 Type A program risk assessment changes ► A Type A program that has been audited once in the 2 previous years that has no prescribed audit findings in the prior year is a required low risk Type A program ► Can not use judgment and say it is a high risk program because program is inherently risky or complex, etc (SFA & R&D) ► Exceptions for risk indicated by results of follow-up on federal or pass through entity audit findings or any changes in personnel or systems affecting the program that indicate significant increased risk to preclude low risk designation

46 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 46 OMB uniform guidance — changes to Type B program risk assessment process ► Eliminates the two Type B program risk assessment options in the current Circular A-133 ► Instead, we will perform risk assessments on Type B programs until high risk Type B programs have been identified up to 25% of the low risk Type A programs ► Should result in fewer Type B program risk assessments ► May result in fewer Type B programs subject to audit

47 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 47 OMB uniform guidance — changes to Type B program risk assessment process (cont.) ► Reduce the number of high risk Type B programs that must be tested as major programs from at least one-half to at least one-fourth of the number of low risk Type A programs ► Small Type B programs that would not be subject to Type B program risk assessment would be increased to a flat 25% of the Type A program threshold

48 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 48 Minimum percentage of coverage changes ► Percentage of coverage requirement reduced from 50% to 40% for an entity that is not a low risk auditee ► Percentage of coverage requirement reduced from 25% to 20% for a low risk auditee

49 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 49 Changes to low-risk auditee criteria ► The criteria for low-risk auditee now more clearly includes data collection form submission within required time frames (as enumerated in the current OMB Circular A-133 Compliance Supplement) as a criteria ► Adds a criteria that the auditor did not report a substantial doubt about the auditee’s ability to continue as a going concern

50 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 50 Changes to low-risk auditee criteria (cont.) ► Adds a criteria that the financial statements reported on have to be prepared in accordance with GAAP or another basis of accounting if required by state law

51 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 51 Changes to major program determinations ► OMB believes that the changes will result in more targeted audit coverage of programs with material weaknesses and material noncompliance and: ► Burden relief for entities that materially comply as evidenced by an unmodified audit opinion, no material weaknesses in internal controls over compliance and no material questioned costs ► Incentive for entities to focus on correcting material weaknesses and material noncompliance

52 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 52 Changes to major program determinations (cont.) ► Entities that are dominated by one large program may not realize burden relief because that program has to be audited each year as major to achieve minimum percentage coverage ► We may see situations where there are fewer Type A programs and we are selecting additional programs (the current Type A programs) to achieve minimum percentage coverage with minimal impact on number of major programs

53 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 53 A reduction in compliance requirements was initially proposed ► Compliance requirements subject to audit would have been reduced from 14 to the remaining 7 below ► A-Activities allowed or unallowed and B- Allowable costs/cost principles ► This would encompass some testing of H- period of availability of federal funds and G- matching (where matching is applicable to the program) ► C-Cash management ► E-Eligibility ► L-Reporting ► M-Subrecipient monitoring ► N-Special tests and provisions

54 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 54 A reduction in compliance requirements was initially proposed (cont.) ► The following compliance requirements would have been eliminated but a federal agency could have requested that they be added back through N- Special tests and provisions ► D-Davis Bacon Act ► F-Equipment and real property management ► I-Procurement, suspension and debarment ► J-Program income ► K-Real property and relocation assistance

55 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 55 Reduction in compliance requirements — reaction to proposed guidance ► Many commenters to the Proposed Guidance were concerned about the ability of federal agencies to add back compliance requirements through special tests and provisions, the process to eliminate compliance requirements not being subject to public notice and a comment period and that this would increase burden

56 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 56 Reduction in compliance requirements — Uniform Guidance ► Any reduction to the number of compliance requirements subject to the Circular 133 compliance audit has now been deferred to the annual OMB Circular A-133 Compliance Supplement process ► Changes likely in the 2015 Compliance Supplement ► Uniform guidance does not list the compliance requirements subject to audit ► 2015 version for vetting expected by late 2014

57 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 57 Changes to 2015 Supplement to be considered ► Whether the types of compliance requirements which require the auditor to test beyond the normal financial system (e.g., performance reporting, special reporting, and certain special tests and provisions) can be reduced ► Updates to Part 6 – Internal Control to be consistent with the GAO’s “Green Book” (when its revisions are finalized) and the Committee of Sponsoring Organizations of the Treadway Commission (COSO)

58 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 58 OMB uniform guidance — findings ► Emphasis on proper perspective information in findings ► Information on audit sampling in the body of the finding when findings involve items identified in auditor samples ► Indicate whether sampling used was statistically valid ► Indicate whether current year finding was a repeat of a prior year finding and the prior year finding number ► Threshold for reporting questioned costs findings increases from $10,000 to $25,000

59 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 59 OMB uniform guidance — Schedule of Expenditures of Federal Awards (SEFA) ► Amounts provided to subrecipients by federal program required on the face of the Schedule of Expenditures of Federal Awards (SEFA) ► Currently it is provided in the face or the notes of the SEFA, to the extent practical ► The notes to the SEFA will have to disclose whether the entity used the flat 10% indirect cost rate

60 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 60 OMB uniform guidance — Schedule of Expenditures of Federal Awards (cont.) ► The face of the SEFA must now include all federal awards expended including: ► Noncash assistance ► Loan guarantee programs ► Loan programs- ► Beginning balance of outstanding loans plus loans disbursed during the period plus interest subsidy, cash, or administrative cost allowance

61 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 61 Uniform Guidance — other reporting package items ► Financial statement findings, not just federal award findings are required in the Summary Schedule of Prior Audit Findings ► More clearly articulates that the Corrective Action Plan is a separate auditee document outside and apart from the management’s response and planned corrective actions section of the respective current year finding in the Schedule of Findings and Questioned Costs

62 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 62 OMB uniform guidance — other ► Next business day is the due date for the data collection form and related reporting package when nine month Circular A-133 deadline falls on a weekend

63 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 63 OMB uniform guidance — other areas ► Full Circular A-133 reporting packages, including the audited financial statements will be publicly available ► Processes with respect to preventing Protected Personally Identifiable Information (PII) and other confidential information from being included in the reporting package will need to be developed ► Senior level representative of the audited entity is to make a certification of such in the data collection form ► A national Circular 133 audit quality study is required to be performed every six years beginning in 2018

64 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 64 Effective Dates ► Effective for awards or increments of awards issued after December 26, 2014 ► The audit requirements in Subpart F are effective for fiscal years beginning on or after December 26, 2014 ► Early implementation is not permitted!

65 © 2014 EYGM Limited. HFMA – October 17, 2014 PresentationSlide 65 Transition Audit Issues ► For example, Audits for fiscal years ending on June 30, 2015 and December 31, 2015-will be auditing against recipient criteria under current OMB Circulars for part of the fiscal year and the Uniform Guidance for another part of the fiscal year


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