What Is the Single Audit Threshold for $1,000,000? Critical Facts

What Is a Single Audit?

A Single Audit—also known as a Subpart F Audit—is a comprehensive review of an entity's financial statements and its compliance with federal program requirements. It applies to non-federal entities, including nonprofits, state and local governments, and tribal organizations, that expend a significant amount of federal assistance in a given fiscal year.

Conducted under the Uniform Guidance (2 CFR Part 200, Subpart F) and in accordance with the Yellow Book (GAGAS), the Single Audit consists of two components:

• Financial Audit: Examines the fairness of the entity’s financial statements.
• Compliance Audit: Assesses adherence to the rules and conditions of major federal programs, such as reporting, allowable costs, and procurement.

The New $1,000,000 Threshold

Starting with fiscal years beginning on or after October 1, 2024, organizations that expend $1,000,000 or more in federal awards are required to undergo a Single Audit. This replaces the previous threshold of $750,000, which had been in place since 2015.

Why This Matters

The increase in the threshold brings several important implications:

• Reduced Burden for Smaller Recipients: Organizations expending between $750,000 and $999,999 in federal funds will no longer be required to complete a Single Audit, saving time and resources.
• Higher Bar for Oversight: For entities exceeding the new threshold, the requirement to demonstrate both financial and program compliance becomes even more critical.
• Need for Careful Monitoring: Organizations must closely track all sources of federal funding, including direct grants and pass-through awards, to determine whether they meet the new audit requirement.

In summary, the updated $1,000,000 Single Audit threshold reflects a shift toward risk-based oversight. Organizations near or above this limit should plan proactively to ensure full compliance under the revised rules.