Circular A133

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Circular A-133

• Audits of States, Local Governments
• and Non-Profit Entities

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A-133 Emphasis

• Sets Standards for audit consistency and
  uniformity
• Identifies compliance requirements
• Establishes criteria for testing internal
  controls
• Tests for reasonable assurance that financial
  statements are accurate

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Pieces of the A-133 Puzzle

• Part A - General
• Part B - Audits
• Part C - Auditees
• Part D - Pass-through Entities
• Part E - Auditors
• Appendix
• A.- Data Collection Form
• B.- Compliance Supplement

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A-133 Subpart A - Purpose

• Sets forth standards for obtaining consistency
  and uniformity among Federal agencies for the
  audit of non-Federal entities Universities
  expending Federal funds.

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A-133 Subpart A - Definitions

• CFDA Number
• The number assigned to a Federal program in the
  Catalog of Federal Domestic Assistance (CFDA).
• Examples
• 59.037 SBDC
• 47.076 Education/Human Resources

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A-133 Subpart A - Definitions

• Internal Control
• Process designed to provide reasonable assurance
  of achieving the following
• Effective efficient operations
• Reliable financial reporting
• Compliance with laws regulations

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A-133 Subpart A - Definitions

• Pass-through Entity
• A non-Federal entity that provides a Federal
  award to a subrecipient to carry out a Federal
  program
• SubrecipientA non-Federal entity that expends
  Federal funds received from a pass-through entity
  to carry out a Federal program.

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A-133 Subpart B - Audits

• Defines
• Who is required to be audited
• Determining subrecipient vs. vendor
• Frequency of audits

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A-133 Subpart B - Audits

• Single audit is required for non-Federal entities
  that expend 500,000 or more in Federal funds
  within a FY. _.200 (b)
• A single audit is in lieu of any financial audit
  required under an individual award. _.215 (a)

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A-133 Subpart B - Audits

• An auditee may elect to have a program-specific
  audit when funds are expended from only one
  Federal Program. _.200 (c)
• Audits shall be performed annually there are
  provisions for biennial audits. _.220

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A-133 Subpart B - Audits

• VS

Subrecipients
Vendors _.210

• Has its performance measured against whether the
  objectives of the Federal Program are met
• Has responsibility for programmatic decision
  making
• Has responsibility for adherence to applicable
  Federal program compliance requirements

• Provides similar goods or services to many
  different purchasers
• Operates in a competitive environment
• Provides goods and services that are ancillary
  to the operation of the Federal program

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A-133 Subpart B - Audits
Who pays for the audit? _.230

• If the audit is conducted in accordance with
  A-133, costs may be charged to Federal awards.
• This expense may be considered a direct cost or
  an allocated indirect cost.

• If the audit is not conducted in accordance with
  A-133, costs may NOT be charged to a Federal
  award.

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A-133 Subpart C - Auditees

• Auditee responsibilities _.300
• Identify all Federal awards received (funds are
  listed in the A-133 report)
• Maintain control over Federal program
• Comply with laws regulations
• Prepare financial statements
• Ensure audits are done submitted when due
• Follow up and take corrective action

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A-133 Subpart C - Auditees

• The auditee shall prepare financial statements
  that reflect its financial position. _.310 (a)
• The auditee shall prepare a schedule of
  expenditures of Federal awards for the period
  covered by the financial statements. _.310 (b)

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A-133 Subpart C - Auditees

• The auditee is responsible for follow-up and
  corrective action on all audit findings. _.315
  (a)
• At the completion of the audit, the auditee shall
  prepare a corrective action plan to address each
  audit finding. _.315 (c)

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A-133 Subpart D Federal Agencies and
Pass-Through Entities

• Recipients expending more than 25 million per
  year in Federal awards shall have a cognizant
  audit agency. _.400 (a)
• The cognizant agency is the agency that provides
  the predominant amount of directing funding to
  the recipient, unless the OMB assigns a different
  agency.
• The cognizant agency is reviewed every five
  years.
• The current cognizant agency for UVA is DHHS.

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A-133 Subpart E - Auditors

• The audit shall
• be conducted in accordance with GAGAS _.500 (a)
• cover the entire operations of the auditee (or a
  series of audits of departments, agencies, or
  other units) _.500 (a)
• The auditor shall follow up on prior audit
  findings. _.500 (e)

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A-133 Subpart E - Auditors

• The auditor shall report the following audit
  findings _.510 (a)
• conditions of internal controls
• any material noncompliance with provisions of
  laws, regulations, etc.
• questioned costs gt 10,000
• any known fraud
• Audit findings should be presented in detail in
  order to allow the auditee to prepare a
  corrective action plan and address audit findings.

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A Final Thought
A government that is big enough to give you all
you want is big enough to take it all away.
Barry Goldwater