Audit Requirements for Grant-Funded Entities
Per the Office of Management and Budget (OMB) Supercircular §200.501 audit requirements, any for-profit entity that expenses $750,000 or more of Federal awards (including SBIR/STTR grants) during their fiscal year will be subject to an audit. The threshold is inclusive of all Federal grants and contracts expenditures regardless of the size of the individual grant or contract. Your company will need to determine which type of audit will be required to fulfill the Federal audit requirements. In most scenarios a Yellow Book audit will be required. If all of the Federal awards qualify as clusters of programs (for example: research and development, student financial aid, or other clusters as defined by OMB), a program-specific audit may be conducted. A program-specific audit is generally less expensive than a Yellow Book audit, and will evaluate the company’s internal controls and compliance requirements.