Single Audit Readiness for Nonprofits: When It Applies and What Auditors Test

A Single Audit is an independent audit of your whole organization, required by the federal government in any year you spend $1,000,000 or more in federal grants. It covers your financial statements and your federal programs in a single audit, which is where the name comes from. A Single Audit is where every other Uniform Guidance requirement gets tested at once: your financial statements, your federal spending, your internal controls, and your compliance with the rules of your largest programs. This guide is for anyone at a nonprofit who needs to know whether the organization will need one, when it is due, and what has to be ready before the auditor arrives. For the full set of requirements behind it, see Uniform Guidance Compliance for Nonprofits.

The short answer

• When it applies. A nonprofit that spends $1,000,000 or more in federal awards during its fiscal year must have a Single Audit for that year, under 2 CFR 200.501. The $1,000,000 threshold applies to fiscal years beginning on or after October 1, 2024; earlier years used $750,000.
• The exception. An organization that spends federal awards under only one program can, under certain conditions, elect a narrower program-specific audit instead.
• What it covers. An independent auditor tests your financial statements, your schedule of expenditures of federal awards, the internal controls over your major programs, and your compliance with the rules of those programs.
• When it is due. The audit, the data collection form, and the reporting package are due 30 days after you receive the auditor's report or nine months after the end of your fiscal year, whichever comes first (200.512). They are submitted to the Federal Audit Clearinghouse.

The practical takeaway: the audit tests records you created during the year. Most of what makes a Single Audit go smoothly happens months before the auditor arrives.

Does your organization need one?

The test is how much you spent in federal awards during the fiscal year, not how much you were awarded. A few rules decide what counts:

• Spending is counted when the activity happens. Under 200.502(a), an award is expended when the activity related to it occurs: when you incur the cost, disburse funds to a subrecipient, or receive property, for example. A three-year, $2,000,000 grant does not count as $2,000,000 in the year it is signed.
• Subawards count. Federal funds you receive as a subrecipient through a state or another organization are federal awards for this purpose (200.501(g)).
• Contract payments do not. Money you receive as a contractor for goods or services is not subject to the Single Audit (200.501(g)).
• Below the threshold, you are exempt. An organization that spends less than $1,000,000 is exempt from federal audit requirements for that year, but its records must still be available for review by the federal agency, the pass-through entity, and the Government Accountability Office (200.501(e)).

Here is how the threshold and the deadline work out for the most common fiscal year ends:

If your fiscal year ends on	First year with the $1,000,000 threshold	Reporting package due (9-month limit)
December 31	Calendar year 2025	September 30 of the next year
March 31	Year ending March 31, 2026	December 31
June 30	Year ending June 30, 2026	March 31 of the next year
September 30	Year ending September 30, 2025	June 30 of the next year

If your auditor delivers the report earlier, the package is due 30 days after you receive it, if that comes first. A due date that falls on a weekend or federal holiday moves to the next business day.

What the auditor tests

The scope of the audit is set in 200.514. It has four parts, two about your numbers and two about your federal programs:

Major programs are chosen by the auditor through a risk-based process in 200.518. For an organization that spends between $1,000,000 and $34 million in federal awards, any program with $1,000,000 or more in expenditures is a larger, "Type A" program. The auditor then weighs risk, including each program's audit history, to decide which programs to test in depth. A Type A program can be treated as low-risk only if it was audited as a major program in one of the two most recent audit periods, so in a first Single Audit, every Type A program is tested as a major program.

What your organization prepares

Under 200.508, the organization being audited is responsible for four things:

1. Arranging the audit and making sure it is completed and submitted on time.
2. Preparing the financial statements, including the schedule of expenditures of federal awards.
3. Following up on audit findings, with a summary schedule of prior audit findings and a corrective action plan for current ones (200.511).
4. Giving the auditor access to staff, accounts, books, records, and supporting documentation.

The schedule of expenditures of federal awards (SEFA) is a list of all the federal money you spent during the year, grouped by federal agency and program. It is required only for a Single Audit, so if this is your first one, it is likely the first time you prepare it. Under 200.510(b), it shows:

• Each program you spent money on, with its Assistance Listing number, the federal number that identifies the program (it used to be called the CFDA number).
• The total spent on each program, and on each cluster of related programs.
• For funds you received through another organization, the name of that organization and the award number it gave you.
• The total you passed on to your own subrecipients from each program.
• Notes on how you prepared the schedule, and whether you used the de minimis indirect cost rate.

If each award already has its own cost center in your books, the SEFA comes straight from the general ledger. If it does not, someone has to rebuild it at year end.

Where small nonprofits are most exposed

These are general patterns rather than an official list, but each one traces back to a requirement the auditor tests:

• Salary charges without effort records. Salaries are often the largest cost on an award, and they have to be supported by records of the work actually performed. See Time and Effort Reporting Under 2 CFR 200.430.
• Unallowable costs on an award. Costs such as alcohol, organized fundraising, or lobbying have to stay off federal awards, including the indirect cost rate. See Allowable Costs Under Subpart E.
• A SEFA that does not tie to the books. If spending per award is pieced together outside the general ledger, it is hard to show that the schedule matches the financial statements.
• Missing written procedures. The financial management standards in 200.302 require written procedures for payments and for deciding what is allowable. An auditor testing internal control will ask for them.
• Repeat findings. A finding that was not corrected shows up again in the summary schedule of prior audit findings, and it can affect how the auditor assesses risk in the next audit.

A note on what may change

On May 29, 2026, the Office of Management and Budget (OMB) proposed a rewrite of 2 CFR Part 200. The continuing appropriations act signed on September 2, 2026 prevents OMB from finalizing that rule through December 11, 2026. Until a final rule is published, the current Subpart F, including the $1,000,000 threshold, is what applies.

How WiseCost fits

WiseCost is time tracking and labor distribution software that works on top of QuickBooks Online. Besides government contractors, it is built for nonprofits and other recipients of federal grants that follow the Uniform Guidance. It has a Uniform Guidance compliance preset that sets strict timekeeping controls in one step, tracks each federal award with its period of performance and budget, and posts salaries to each award in QuickBooks Online based on the hours people actually recorded, which is the core of time and effort reporting under 2 CFR 200.430. For a Single Audit, it gives you the salary records an auditor tests, with an audit trail that cannot be edited.

The financial statements and the SEFA are yours and your auditor's to prepare. What WiseCost provides, on top of the QuickBooks Online you already use, is the evidence behind the salaries charged to your awards:

• Salary charges backed by approved time. For staff who log their time, each payroll period Labor Distribution posts each person's pay to the awards and activities they recorded, as a journal entry in QuickBooks Online.
• A report per award. The Labor Distribution report shows each person's hours, share of time, and salary charged to each award, and its totals match QuickBooks Online.
• An audit trail that cannot be edited. Every time entry, approval, and change is recorded with who made it, when, and what it said before. Nothing can be edited or deleted, and you can export it for the auditor.
• Reports kept as generated. Report History keeps each report as it was run, so you can show what the numbers were on a given date, even if settings changed afterward.
• Each award inside its dates. Time cannot be logged to an award outside its period of performance, and the Budget vs Actual by Contract report compares each award's hours and dollars with its budget.

Setup steps are in Setting up WiseCost for the Uniform Guidance.

FAQ

The Bottom Line

The Single Audit is triggered by one number, $1,000,000 in federal spending in a fiscal year, and it is due on a fixed clock: 30 days after the auditor's report or nine months after year end, whichever comes first. What the auditor tests is the year you already lived: how each award was tracked, how salaries were supported, which costs were kept off the awards, and whether your written procedures exist. An organization that keeps those records as it goes spends its audit answering questions instead of reconstructing a year.

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See salary charges by award, with the approvals behind them, on your own books: book a demo, or start a 14-day trial of WiseCost on the QuickBooks Online you already run. No credit card required.

Official Sources

• Audit requirements and threshold: 2 CFR 200.501
• Determining federal awards expended: 2 CFR 200.502
• Auditee responsibilities: 2 CFR 200.508
• Schedule of expenditures of federal awards: 2 CFR 200.510
• Audit findings follow-up: 2 CFR 200.511
• Report submission and due date: 2 CFR 200.512
• Scope of the audit: 2 CFR 200.514
• Major program determination: 2 CFR 200.518
• When the $1,000,000 threshold took effect, per OMB's 2024 Compliance Supplement: Plante Moran, 5 key takeaways from the 2024 Compliance Supplement
• Federal Audit Clearinghouse: fac.gov
• Status of the 2026 proposed rule: BDO, What the Continuing Resolution Means for OMB's Proposed Uniform Guidance Rewrite