Not-for-Profit Industry Alert
We Have Received COVID-19 Funding – Now What?

Dear Clients and Friends,

As a result of the COVID-19 Pandemic, many organizations have applied for and have received various degrees of COVID-19 Funding. With June 30, 2020 year-ends quickly approaching, there are a lot of concerns and questions regarding the reporting and compliance requirements of each of these funding sources.

There is no easy answer, but this newsletter provides the most recent information provided by the AICPA Governmental Audit Quality Center (GAQC) on June 16, 2020. Please note that the requirements could change and you are encouraged to check periodically on the hyperlinks included in the AICPA document, 2020 OMB Compliance Supplement (once it is made available), and directly with your funding sources.

If you would like to discuss any of the content provided here or if you have a topic that you would like us to address in a future newsletter, please do not hesitate to contact me, or any member of Kreischer Miller’s Not-For-Profit Industry Team. We look forward to hearing from you!

Maxine Romano, CPA, Kreischer Miller

COVID-19 funding primarily consist of 4 New Programs:

Paycheck Protection ProgramFederal Agency: Small Business Association (SBA) – provided over $600 billion to both for-profits and non-for–profit entities.  It has been communicated by the SBA that these funds ARE NOT subject to single audit compliance and procedures.

Provider Relief Fund – Federal Agency: U.S Department of Health and Human Services (HHS) provided $175 billion to for-profits, not-for-profits and governmental agencies is currently subject to single audit compliance and reporting under CFDA 93.498.

Coronavirus Relief Fund (CRF) – Federal Agency: U.S Department of the Treasury – provided $150 billion to governmental entities and tribes is currently subject to single audit compliance and reporting under CFDA 21.019.

Educational Stabilization Fund – Federal Agency: U.S Department of Education – provided $30.75 billion to education states, schools and IHE and is currently subject to single audit compliance and reporting under CFDA 84.426.

Click below to view the GAQC Summary of Uniform Guidance (UG) Applicability for New Covid-19 Related Federal Programs, which includes all of the above programs along with many other COVID-19 funding programs.

This document provides current information and guidance as it relates to the applicability of the Uniform Guidance reporting requirements with links relevant to each agency to obtain additional information. It is important that management follow the alerts and understand the reporting and compliance requirements for each funding source that it receives.

We recommend that management compile an analysis of all additional resources received, by funding source, amounts expended through the end of the reporting period, and based on the most recent available information, note which are subject to Uniform Guidance (UG).  Please note that if expenditures, or in some cases loan amounts, exceed the $750,000 UG criteria, the entity will be subject to a single audit (compliance audit).  If this scenario fits your organization you should share your results with your auditors as soon as possible.

In addition, we recommend that detailed records are maintained on the use of the funds and all supporting documentation be readily available for audit purposes.

While we expect further guidance is forthcoming, it is important that management understands the reporting requirements in order to ensure compliance and properly plan for their June 30, 2020 audits.

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Information contained in this alert should not be construed as the rendering of specific accounting, tax, or other advice. Material may become outdated and anyone using this should research and update to ensure accuracy. In no event will the publisher be liable for any damages, direct, indirect, or consequential, claimed to result from use of the material contained in this alert. Readers are encouraged to consult with their advisors before making any decisions.