United States

OMB issues 2017 Compliance Supplement


The Office of Management and Budget recently announced the availability of the 2017 Compliance Supplement. This Supplement is a necessary reference source for every Single Audit performed for periods beginning on or after July 1, 2016. The 2017 Supplement includes new guidance, as well as the addition, deletion and modification of various federal programs. A comprehensive list of changes to the 2017 Compliance Supplement from the superseded 2016 Compliance Supplement can be found in Appendix V of the 2017 Compliance Supplement.

Now that the final 2017 Compliance Supplement is available, the draft 2017 Compliance Supplement, which previously was available through the AICPA Governmental Audit Quality Center for audit planning purposes, no longer should be used. The final Supplement includes only one change from the draft Supplement, which is an updated reference to the recently revised Frequently Asked Questions for the Office of Management and Budget’s Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards at 2 CFR 200. Both auditors and auditees are encouraged to review this updated FAQ document, which reflects new and revised questions on the Uniform Guidance presented by the Council on Financial Assistance Reform. Many of the new FAQs relate to indirect costs and other auditee topics, such as subrecipient monitoring and risk assessment, which also are relevant to auditors from the perspective of compliance and internal control over compliance. Additionally, several FAQs directly relate to the audit requirement section of the Uniform Guidance, including the following, among others:

  • 510-1, “Organizing Content of Schedule of Expenditures of Federal Awards (SEFA).” This FAQ concludes that an entity may organize the SEFA in an alternate way such as by state agency or departments of an organization and still be compliant with the requirement to list individual federal programs by federal agency. However, it cautions that entities should ensure that the SEFA is clear and organized.
  • .510-3, “Schedule of Expenditures of Federal Awards. Expenditures Occur in Only One Program Within a Cluster of Programs.” This FAQ clarifies that the auditee should include the name of the cluster on the SEFA regardless of whether the expenditures were incurred under only one program or multiple programs within the cluster of programs.
  • .511-1, “Auditee Responsibility for Preparing the Summary Schedule of Prior Audit Findings and Corrective Action Plan.” This FAQ reiterates that the auditee is responsible for preparing both the Summary Schedule of Prior Audit Findings and Corrective Action Plan (CAP) and states that the auditor should not prepare these documents for the auditee. It also indicates that the CAP must be on the letterhead of the auditee and clarifies that the "views of responsible officials" section of the auditor's finding does not fulfill the auditee's responsibility to prepare the CAP.