SINGLE AUDIT UPDATE

JUNE 2, 20201:00PM CENTRAL

2020 NSAA Annual Virtual Event

Tammie Brown, CPANational Single Audit CoordinatorUS. DHHS-OIG

WHAT WE WILL COVER

• Status of Uniform Guidance Updates

• COVID funding and implications

• Status of 2020 Compliance supplement

UNIFORM GUIDANCE UPDATES

Early February Draft provided to various groups including AICPA, NASCT, CIGIE

March 16, 2020 CIGIE Comments Submitted

March 23, 2020 Comments Due

March 6, 2020 PL 116-123

March 18, 2020PL 116-127

March 27, 2020PL 116-136

April 24, 2020PL 116-139

August 2020 Projected Final updated UG

UNIFORM GUIDANCE FAQ’S

• No longer maintained

• Several incorporated into applicable sections

• Uncertainty regarding those not pulled into specific UG sections

• Uncertainty for future guidance

DEFINITIONS BUDGET PERIOD §200.1

New Definition - Budget period means the time interval during which recipients are authorized to expend the current funds awarded and must meet the matching or cost-sharing requirements, if any.

- implications on multi year awards?

2 CFR 200.431 COMPENSATION –FRINGE BENEFITS

Align 2 CFR with Authoritative Sources to allow states to confirm with GAAP, specifically GASB Statement 68, to allow Non-Federal entities to continue to claim pension costs that are both actual and funded.

This Photo by Unknown Author is licensed under CC BY-SA

OFFICIAL FEDERAL COGNIZANT AND OVERSIGHT AGENCY§513(A)(1)

Changed cognizant determination from predominant direct funding, to include a provision for direct less than 25 percent of total funding to base cognizant and oversight for audit determination on the predominant direct funding.

NATIONAL SINGLE AUDIT PROJECT §513(A)(3)(II)Governmentwide project rely on the current and on-going quality control review work performed by Federal Agencies.

Every 6 years beginning with audits submitted in 2021 or at such other interval determined by OMB.

Results must be public.

Advise audit community, auditee, Federal agencies and professional licensing and regulatory bodies of quality deficiencies that result in failed engagements.

UNIFORM GUIDANCE NEW § 183

Implement Never Contract with the Enemy provisions to grants and cooperative agreements, required by subtitle 8 of the National Defense Authorization Act (NDAA) PL 113-291.

Applicable to grants and cooperative agreements expected to exceed $50,000 performed outside the United States and U.S. Territories that are in support of a contingency operation in which members of Armed Forces are actively engaged in hostilities.

Applicable until December 31, 2019, except Access to Records which has no sunset date.

Federal Awarding agencies required to:

check the current list of prohibited or restricted person or entities on the System of Award Management (SAM) exclusions before making a covered grant or cooperative agreement.

Must include Never Contract with the Enemy clause.

Restrict future awards if become aware of a person or entity.

Terminate grant or cooperative agreement upon becoming aware that the Non-Federal recipient failed to exercise due diligence to ensure that none of the award funds are provided directly or indirectly to a covered person or entity.

Notify Non-Federal entities in writing regarding its decision to restrict all future awards and/ or to terminate a grant, administrative review, or restrictions or termination of the grant within 30 days of notification.

ATTENDANCE CHECK

OMB M-20-11 ADMINISTRATIVE RELIEF FOR RECIPIENTS AND APPLICANTS FOR FEDERAL FINANCIAL ASSISTANCE DIRECTLY IMPACTED BY NOVEL CORONAVIRUS (COVID19) DUE TO LOSS OF OPERATIONS.

Issued March 9, 2020 Short Term Administrative, financial management and audit requirements under 2 CFR 200, for entities that support the

continued research and emergency services necessary to respond to COVID – 19 Exceptions time limited for period during period declared by DHHS through the 90 day Public Health Emergency

Declaration (Public Health Emergency Period). Flexibility with SAM registration/ recertification for applicants – relax active SAM registration at time of application Waiver for Notice of Funding Opportunities Publication for less than 30 days Pre-award costs – allowable from Jan 20, 2020 through Public Health Emergency Period and prior to the effective date of a

Federal award No cost extensions on expiring awards Abbreviated non-competitive continuation request for request scheduled between April 1,2020 to December 31, 2020 Expenditure of award funds for salaries and other project activities Waivers from prior approval requirements Exemption of certain procurement requirements - geographical preferences, contracting with small and minority business

and women business enterprises, and labor surplus area firms. 3 month extensions for submissions of financial and other reports Single Audit submissions up to 12 months beyond normal due date and still qualify for a low-risk auditee.

OMB M-20-17 ADMINISTRATIVE RELIEF FOR RECIPIENTS AND APPLICANTS FOR FEDERAL FINANCIAL ASSISTANCE DIRECTLY IMPACTED BY NOVEL CORONAVIRUS (COVID 19) DUE TO LOSS OF OPERATIONS

• Issued March 19, 2020• Expanded scope of recipients affected to include those with ay loss of operational capacity and increased cost due to the COVID-

19 Crisis• Short term relief for administrative, financial management and audit requirement s under 2CFR Part 200

• Flexibility with Sam Registration – 60 days extension for registrations expiring before May 16, 2020

• Flexibility with application dead lines

• Waiver for Notice of Funding Opportunities – publication for less than 30 days

• No –cost extension on expiring awards fore awards active as of March 31 that expire through Dec 31, up to 12 months extension. Performance reports due 90 days following end of extension.

• Abbreviated non-competitive continuation request

• Allowability of salaries and project activities

• Allowability of Cost not normally Chargeable to Awards – cancellation fees, pausing and restarting grant activities

• Prior Approval requirement Waivers

• Exemption of Certain procurement requirements regarding geographical, small and minority business contracting, and labor surplus area firms

• Extend Financial , performance and other reporting requirements 3 months beyond normal due dates., and still draw down funds.

• Extend Current approved indirect cost rates

• Extension of Close out reports up to 1 yare after the award expires

• Single Audit Report Submissions – Unfiled reports with fiscal year ends through June 30, 2020 up to 6 months beyond normal due date. Automatic extension only need to document reason for delay and still qualify as a low-risk auditee under 2 CFR § 200.520(a)

HHS CORONAVIRUS FUNDING

The Coronavirus Preparedness and Response Supplemental

Appropriations Act Signed March 6, 2020

$8.3 billion$6.5 Billion HHS Funding

Public Law 116-123

Families First Coronavirus Response Act

signed march 18, 2020$192 Billion

$1.3 Billion HHS FundingPublic Law 116-127

The Coronavirus Aid, Relief, and Economic Security

(CARES) Act Signed March 27, 2020

$2.3 Trillion$143.2 Billion HHS funding

Public Law 116-136

The Paycheck Protection Program and Health Care

Enhancement ActSigned April 24, 2020

$484 Billion$100 Billion HHS Funding

Public Law 116-139

New Legislation pending – HEROS ACT

FDA, 1%

CDC , 34%

NIH, 9%

CMS, 1%

ACF, 32%

OIG, 0%

HRSA , 8%

IHS, 6%

ACL, 6%SAMSHA, 2%

HHS Phases 1-4, Percentage of Total by Agency (Excluding Office of the Secretary)

FDA CDC NIH CMS ACFOIG HRSA IHS ACL SAMSHA

The Coronavirus Aid, Relief, and Economic Security (CARES) Act

$100 BillionPublic Law 116-136

PROVIDER RELIEF FUND$175 Billion

Paycheck Protection Program and Health Care Enhancement Act

$75 BillionPublic Law 116-139

GENERAL DISTRIBUTION$50 Billion

TARGET DISTRIBUTION$50 Billion

$12 Billion

High Impact Areas

$10 Billion

Rural Health Providers

$400 Million

Indian Health

Services

$27.6 Billion

Remaining Funds

First Distribution$30 Billion

Proportional Share of

Medicare FFS reimbursement

for 2019

Second Distribution$20 Billion

Percentage of net patient

revenue from all payors for

2018

$75 Billion AID TO HOSPITALSDetails (TBD)

2020 COMPLIANCE SUPPLEMENTLast Section submitted to

OMB for final Clearance 4/30/2020

5/22/2020 CS with COVID info in appendix VII and COVID Addendum Later

May 27 OMB Data Call Deadline

- Most sections in OMB Clearance Process or ready for process

- COVID Appendix Information being developed

- COVID Part 4 sections being identified and developed

COMPLIANCE SUPPLEMENT COVID GUIDANCE

Existing Federal ProgramsAppendix VII

Schedule of New COVID Program Identification NumbersGeneral Guidance statementsSEFA and DCF requires separate Identification of COVID fundingRecipient ResponsibilitiesAnticipate large volume of additional Single Audits

General Part 3 GuidancePossible additions to back ground section to incorporate unique COVID requirements

Addendum Part 4 programsFederal agencies developing program specific sections for new programs with highest impact

SINGLE AUDIT APPLICABILITY NEW COVID CFDA’SFederal Agency Program Title CFDA UG Applicable Sections Single

Audit Applicable

Agriculture Coronavirus Food Assistance Program 10.130 none no

Treasury Coronavirus Relief Fund (CRF) 21.019 Subpart F yes

Federal Communications Commission

COVID-19 Telehealth Program 32.600 none no

Small Business Administration OED Resource Partners Training Portal 59.074 none no

Small Business Administration Economic Injury Disaster Loan Emergency Advance 59.072 none no

Small Business Administration Payroll Protection Program Loans 59.073 none No

Education Stabilization Fund 84.425 Subparts B,C,D,E & F yes

Health and Human Services Uninsured COVID Testing and Treatment 93.461 Subparts B,D,E & F yes

Health and Human Services Provider Relief Fund 93.498 Subparts B,D,E and F yes

Health and Human Services New & Expanded Services Under Health Center Program 93.527 Subpart B,C,D,E & F yes

Health and Human Services Emergency Grants to address Mental and Substance use Disorders During COVID 19 Pandemic

93.665 Subparts B,C,D,E & F yes

Health and Human Services Rural Health Clinic Testing 93.697 Subparts B,D,E & F yes

HHS NEW COVID RELATED PROGRAMS

CFDA 93.665 – Emergency Grants to address Mental and Substance Use Disorders During COVID - 19

CFDA 93.498- Provider Relief Fund

CFDA 93.461 – Uninsured COVID Testing and treatment

CFDA 93.527 Grants for New and Expanded Services under the Health Center Program

93.697 Rural Health Clinic Testing

MEDICAID AND COVID – 19

4 types of Flexibilities Emergency State Plan Amendments

Appendix K amendments to approved 1915 (c) waivers

1115 Disaster waivers

1135 Disaster waivers

Additional waivers related to Conditions of Participation (COPS)

Enhanced FMAP: Families First Coronavirus Response Act and termination suspensions

Survey and Certification Funding - $80 million nationwide for COVID-19 activities

Changes to Eligibility rules changes during PHE Section 6004(a)(3)

FMAP for COVID-19 testing group 100 percent

FMAP not 100 percent for other Medicaid eligible groups

EDUCATION STABILIZATION FUND

CFDA 84.425

States, and local Governments

To prevent, prepare for, and respond to COVID- 19 Pandemic

Authorization CARES ACT PL 116-136; $30,750,000,000 estimated Obligations

UG Applicable sections; Subpart B, C,D,E and F

Seven major components for funds to be allocated

CARES ACT EDUCATION STABILIZATION FUND $30,750,000,000

84.428A - Outlying Areas - $153,750,000

84.425 -Bureau of Indian Education - $153,750,000

84.425B - Education Stabilization Fund Discretionary Grants – 307,500,000

84.425M SIP

84.425C – Governor’s Emergency Education Relief Fund- $2,953,230,33384.428E – Emergency Financial Aid to students84.425F- Institutional support

84.425D – Section 180049 (a)(1) - Elementary and Secondary School Emergency Relief Fund – IHEs – $12,557,254,

84.425E – Higher Education Emergency Relief Fund – HBCUs and MSIs - $1,046,437,87584.425J – HBCUs, HBGIs, HBCU masters84.425K TCCU84.425L ANNH, AANAPISI, NASNTI, PBI, DHSI, PPOHA84.425M SIP

84.425 – Higher Education Emergency Relief Fund – FIPSE - $248,812,62584.425N HHERF FIPSE84.425O EERF FIDSE Competitive

CORONAVIRUS RELIEF FUND (CRF) CFDA 21.019

Authorized under the CARES Act PL 116-136 CFDA 21.019 - pending OMB Clearance

Part 4 CS Addendum supplement being developed Subject to UG Sections:

303 internal controls 330 to 332 subrecipient monitoring and management Subpart F – Single Audit

$150 Billion Payments to State, Local, and Tribal governments navigating the impact of the COVID-19 outbreak. Distributions were based on population that exceeds 500,000

Local governments required to submit certifications to Treasury. Payments began Tribal government payments on May 5, 2020

To cover expenses that – are necessary expenditures incurred due to COVID-19; Were not budgeted as of prior to March 27, 2020; and Were incurred between March 1, 2020 and December 30, 2020.

PAYROLL PROTECTION PROGRAM (PPP)

CFDA 59.073

Not subject to Single Audit Provisions

EPA COVID FUNDS 1million for grants under State Environmental Justice Cooperative Agreement Program (SEJCA)/COVID-19- CFDA 66.312

https://www.grants.gov/web/grants/view-opportunity.html?oppId=326650

UG Subparts B, C, D, E and F applicable

7.5 million to clean and disinfect EPA facilities Drinking Water State Revolving Fund CFDA 66.468

Capitalization Grants for Clean Water State Revolving Funds CFDA 66.458

Questions ?