Volume 21.04
The Department of Health and Human Services (“HHS”) has updated the rules relating to the reporting of Provider Relief Funds (“PRF”) use by nonfederal entities as part of the single audit requirements.
Recipients that expend a total of $750,000 or more in federal funds (including PRF payments and other federal financial assistance) during their fiscal year are subject to Single Audit requirements, as set forth in the regulations at 45 CFR 75 Subpart F. Non-federal entities must have a Single Audit conducted in accordance with 45 CFR 75.514. Commercial organizations have two options under 45 CFR 75.216(d) and 75.501(i): 1) a financial related audit of the award or awards conducted in accordance with Generally Accepted Government Auditing Standards; or 2) an audit in conformance with the requirements of 45 CFR 75.514 – Single Audit).
The schedule of expenditures for federal awards (“SEFA”) is now to be reported as follows:
- For a fiscal year end of June 30, 2021, and through fiscal year ends of Dec. 30, 2021, recipients are to report on the SEFA, the total expenditures and/or lost revenues from the Period 1 report submission to the PRF Reporting Portal.
- For a fiscal year end of Dec. 31, 2021, and through fiscal year ends of June 29, 2022, recipients are to report on the SEFA, the total expenditures and/or lost revenues from both the Period 1 and Period 2 report submissions to the PRF Reporting Portal.
- For fiscal year ends on or after June 30, 2022, SEFA reporting guidance related to Period 3 and Period 4 will be provided later.
The Period reports are based on the date that the PRF was received. The Periods are as follows:
- Period 1 – Payments received from April 20, 2020, to June 30, 2020; deadline to use funds of June 30, 2021.
- Period 2 – Payments received from July 1, 2020, to December 31, 2020; deadline to use funds of December 31, 2021.
- Periods 3 and 4 – Payments received from January 1, 2021, through December 31, 2021; deadline to use the funds are December 31, 2022.
For December 31, 2021 year-ends, all use of PRF funds received between April 20, 2020, and December 31, 2020 (Periods 1 and 2), are to be reported on the SEFA even though the use of the funds essentially covers the beginning of the public health emergency (“PHE”) through December 31, 2021. If you have a June 30, 2021, year-end, you will report expenditures through June 30, 2021 (Period 1), on the SEFA.
Based on the new guidance the use of PRF funds is now not required as part of audited financial statements of nonfederal entities for periods ended on or before June 29, 2021. Many audits have already been completed for December 31, 2020, year-ends. All nonfederal entities should discuss the impact of the new requirements on their audited financial statements.
Recipients that expend a total of $750,000 or more in federal funds (including PRF payments and other federal financial assistance) during their fiscal year are subject to Single Audit requirements, as set forth in the regulations at 45 CFR 75 Subpart F.
Non-federal entities must have a Single Audit conducted in accordance with 45 CFR 75.514.
Commercial organizations have two options under 45 CFR 75.216(d) and 75.501(i): 1) a financial related audit of the award or awards conducted in accordance with Generally Accepted Government Auditing Standards; or 2) an audit in conformance with the requirements of 45 CFR 75.514 – Single Audit).
More information is available at Reporting Requirements and Auditing | HHS.gov. Do not hesitate to reach out to us with any questions you may have regarding this matter at contact@healthgroup.com. If you are attending the upcoming NAHC Financial Management Conference in Chicago, do not hesitate to visit us at Booth 612 to discuss the audit requirement revisions.