Audit Requirements

1
Audit Requirements

• Fifth Annual NIH SBIR/STTR Conference

2
Audit? Who said anything about having an audit?

• The Department of Health Human Services did!
• HHS specifies requirements for audits of
  for-profit organizations in
• 45 CFR 74.26(d)

http//www.hhs.gov/progorg/grantsnet/adminis/cfr
45-docs/p74-subc.html74.26
3
Lets have that in plain English.

• A for-profit organization is required to
• have a non-Federal audit if
• it expended a total of 300,000 or more under one
  or more HHS awards
• AND
• at least one of the awards is an HHS grant

4
I thought the 300,000 expended threshold was
related to OMB Circular A-133 and isnt that for
non-profits and universities?

• Yes and YesHowever, 45 CFR 74.26(d) essentially
  incorporates the thresholds and deadlines of OMB
  Circular A-133.

5
So, I must have an A-133 audit if I expend
300,000 or more in HHS funds and I have at
least one grant award.

• Not exactly.

6
Good news !You have a choice.

• 45 CFR 74.26(d) provides for-profit organizations
  with two options regarding the type of audit that
  will satisfy the audit requirements.

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1 - A financial related audit as defined in, and
in accordance with, the Government auditing
Standards (a.k.a. the Yellow Book)
OR
2 - An audit that meets the requirements of OMB
Circular A-133
http//www.gao.gov/govaud/ybk01.htm
http//www.whitehouse.gov/OMB/circulars/a133/a133.
html
8
Is there a due date?

• Yes, 45 CFR 74.26(d) essentially incorporates the
  deadlines of OMB Circular A-133 - Audits shall be
  completed and submitted within
• 30 days after receipt of the auditors report
• or
• 9 months after the end of the organizations
  fiscal year

Whichever is earlier
9
OMB Circular A-133 requires a Data Collection
Form (DCF). If I choose to have an A-133 audit,
should the DCF be completed and submitted with
the audit?

• Regardless of the type of audit chosen,
  commercial organizations are not required to fill
  out and submit a Data Collection Form.

10
Okay, the auditors have done their work and the
audit is complete. Now what?

11
Good question! The filing requirements differ for
commercial organizations. Audit reports should be
submitted to National External Audit Review
Center HHS Office of Audit Services 323 West 8th
Street Lucas Place, Room 514 Kansas City, MO 64105
12
I didnt expend more than 300,000 in HHS funds
this fiscal year so Im off the hook, right?
Great,

• While it is true you are not required to have an
  audit for that particular fiscal year, keep in
  mind that your grant-related records must be
  available to NIH or other designated officials
  for review or audit.

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Where can I get more information?
There are frequently asked questions (FAQs)
related to non-federal audit requirements for
commercial (for-profit) organizations on the
following web site http//ocm.od.nih.gov/dfas/faq
forprofitaudits.htm