Professional Standards Committee Highlights – New Uniform Guidance Requirements

In April 2024, the Office of Management and Budget announced significant changes to the Uniform Guidance, now called the Guidance for Federal Financial Assistance, which provides guidelines for compliance with federal grant programs. The new guidance is effective for federal awards made on or after October 1, 2024. Below are some of the significant changes that affect non-federal entities.  

• Single Audit Requirements – The Single Audit threshold has been increased from $750,000 to $1,000,000. Local governments that annually expend $1 million or more of federal funds in a fiscal year will be subject to a Single Audit. The new audit threshold applies to fiscal years starting on or after October 1, 2024. 
  
  
• Whistleblower Protections – New provisions were added to recognize certain legal protections for whistleblowers. The recipients and subrecipients must inform their employees in writing about these whistleblower rights and protections.
  
  
• Cybersecurity – Added a requirement that recipient and sub-recipient internal controls include cybersecurity and other measures to safeguard information.
  
  
• Equipment – Revised the threshold value for equipment from $5,000 to $10,000.  Therefore, when equipment is purchased at a cost of $10,000 or less, it can be expensed rather than capitalized.
  
  
• Requirements for Pass-Through Entities – Added a requirement for pass-through entities to confirm that potential sub-recipients are not suspended or debarred from receiving federal funds.
  
  
• Indirect Costs – Raised the de minimus rate non-federal entities can use for indirect costs from 10% to 15%.  Recipients and sub-recipients that do not have a current federal negotiated indirect cost rate may elect to charge the de minimus rate.

This listing is not a comprehensive listing of all changes to the guidance.  Refer to the new guidance at Federal Register :: Guidance for Federal Financial Assistance for more details.

If you have questions regarding this topic, contact Donna K. Lee, Chair of the Professional Standards Committee at standards.chair@csmfo.org. 

The Professional Standards Committee operates as a technical resource to CSMFO members. The Committee is comprised of municipal and commercial members whose mission is to keep members informed of emerging issues and best practices.