Uniform Guidance Updates to Address and Common Pitfalls to Avoid Before Your June 30 or September 30 Year-End
If your organization receives federal funding — whether you’re a Tribal government, local government, healthcare organization, or nonprofit — 2026 is a year to pay close attention to your Single Audit readiness.
“The most significant update since 2013”
The April 2024 revisions to the Uniform Guidance (2 CFR Part 200), the federal framework governing grant administration and Single Audit requirements, are the most significant update to these rules since 2013. They’re no longer coming. For many organizations, they’re already in effect. This article walks through what changed, what’s always driven findings, and what you can do right now to head into your next Single Audit prepared — not scrambling.
Two Keys to a Successful 2026 Audit
OMB issued major revisions to the Uniform Guidance (2 CFR Part 200) in April 2024—the most significant update since the Uniform Guidance was released in 2013. While these changes are no longer “breaking news,” they are increasingly important as governments, healthcare organizations, and nonprofits approach year-end close, prepare the SEFA, and begin Single Audit fieldwork.
For Tribal governments (often 9/30 year-ends), local governments (often 6/30 year-ends), healthcare organizations (often 6/30 year-ends), and many nonprofit organizations (often 6/30 year-ends), a successful Single Audit outcome in 2026 depends on two things working together:
- Implementing the Uniform Guidance revisions that apply to your awards and audit year, and
- Strengthening execution in historical problem areas that continue to drive findings, such as eligibility documentation, reporting timeliness/accuracy, procurement files, and core grant accounting reconciliations.
Below, we are highlighting the most relevant updates and providing important reminders on recurring compliance and accounting risks that can be addressed now, before year-end and audit testing.
Effective Dates: Two Different Clocks to Track
Applicability depends on which part of the Uniform Guidance applies—and the timing rules differ significantly.
Subparts A-E
Administrative Requirements and Cost Principles, including procurement
These provisions are generally effective for federal awards issued on or after October 1, 2024. Applicability is often award-by-award depending on when the federal agency (or pass-through entity) issues the award (or significant amendment) and what the terms and conditions specify. Many organizations now administer a blend of older awards under prior guidance and newer awards subject to revised rules.
A practical step is to identify which awards were issued (or materially modified) on/after 10/1/2024 and ensure your policy/procedure refresh addresses both (a) baseline organizational standards and (b) any award-specific terms.
Subpart F
Audit Requirements, Single Audit rules
The revisions to Subpart F are effective for fiscal years beginning on or after October 1, 2024. This timing is based on your fiscal year start date, not award issue date. The first year-ends commonly impacted include:
- 9/30/2025 year-ends (fiscal year beginning 10/1/2024)
- 12/31/2025 year-ends (fiscal year beginning 1/1/2025)
- 6/30/2026 year-ends (fiscal year beginning 7/1/2025), including many local governments, healthcare organizations, and nonprofits
- 9/30/2026 year-ends (fiscal year beginning 10/1/2025); for many 9/30 entities, this may be the second year under the revised Subpart F requirements
Why this matters: A Tribe with a September 30 year-end may have already experienced Subpart F changes in the 9/30/2025 audit, while many June 30 local governments, healthcare organizations, and nonprofits will encounter them in the 6/30/2026 audit. Meanwhile, Subparts A–E may apply earlier or later depending on award issue dates.
Subpart F Audit Requirements: Higher Thresholds, Type A Updates, and Extensions
$1M
New Single Audit Threshold
Increased from $750,000 in federal awards expended.
$1M
New Type A Program Threshold
Increased from $750,000, shifting major program planning.
$34M
Type A/B Rules Threshold
Increased from $25 million for certain Type A/B determinations.
Entities near $1.0M should evaluate early whether a Single Audit will be required. Entities above $1.0M should anticipate that major program planning may shift as Type A determinations change.
Audit extensions may be authorized by the cognizant or oversight agency for audit when the nine-month submission timeframe would place an undue burden on the auditee. However, OMB guidance indicates extensions are intended only when there is a substantial and unjust obstacle to timely submission—not simply to preserve low-risk status. Plan for timely completion rather than assuming an extension will be available.
Procurement: A Top Audit Risk for All Recipients and the Most Significant Change for Tribes
Procurement remains one of the most common Single Audit finding areas because it is decentralized, documentation-heavy, and often time-sensitive. In 2026, procurement risk is heightened when policies were updated but day-to-day documentation practices did not keep up.
New Tribal Procurement Flexibility
Tribes and Tribal organizations can now follow their own procurement policies and procedures, similar to States.
A central change for Tribes is a procurement revision intended to treat Native American Tribes the same as States, allowing Tribes and Tribal organizations to follow their own procurement policies and procedures for federal funds.
In practical terms:
- If the Tribe has formal procurement policies and procedures, Uniform Guidance-specific procurement thresholds and methods are not automatically required for Tribal procurements under federal awards.
- Procurement must follow the same policies used for non-federal funds. This increases the importance of having clear, current, formally adopted policies and ensuring consistent practice across departments and programs.
- Sole source justifications do not have to be limited to the reasons stated in Uniform Guidance, but they still must be defensible, documented, and consistent with Tribal policy and award terms.
- The prior Uniform Guidance prohibition on geographic preferences was removed, which may support local preference policies where permitted by Tribal policy and not restricted by the award.
Important caveat: If a Tribe does not have formal procurement policies and procedures, then the procurement methods in 2 CFR 200.320 apply.
If your team is working through what these procurement changes mean in practice, REDW offers customizable Uniform Guidance Training built specifically for Tribal Nations, and other federal funding recipients — led by the same advisors who conduct Tribal audits and see compliance issues firsthand.
Other Procurement Updates
The revised procurement provisions also include:
- Terminology – Terminology updates: “small purchases” changed to “simplified acquisitions.”
- Small Purchases – Clarification that micro-purchases and simplified acquisitions are informal procurement methods for small purchases.
- Sealed Bids – Removal of the requirement for public opening of sealed bids for local and tribal governments.
- Veteran-Owned Businesses – Added encouragement to consider veteran-owned businesses.
- Sustainability – Added sustainability-oriented purchasing encouragement (reused/recycled/energy- and water-efficient products).
Procurement Readiness: What Auditors Test & What to Do Now
What Auditors Typically Test
Procurement findings often come down to missing or incomplete evidence, such as:
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| Inadequate competition documentation (or missing sole source/emergency justification) |
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| Insufficient documentation of price/cost reasonableness |
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| Missing required approvals |
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| Contract files that do not contain required clauses or do not align with policy |
Recommended Actions Now
 Confirm Policy Currency |
| Ensure your policy is current, formally adopted, and accessible. |
 Match Policy to Practice |
| Verify the policy reflects how purchases actually occur (cooperative purchasing, piggybacking, online purchasing, emergency purchases, change orders). |
 Standardize Documentation |
| Standardize procurement file documentation with checklists and templates aligned to your policy. |
 Train Program Staff |
| Train those who initiate purchases; many exceptions occur before finance/procurement sees the transaction. |
 Pre-Audit File Review |
| Perform a pre-audit file review on a sample of federal purchases now while there is time to remediate gaps. |
Equipment, Internal Controls, Subrecipients & Indirect Costs
Equipment & Supplies
$10,000 Thresholds and Tribal Equipment Disposition Under Tribal Law
Several revisions increase thresholds from $5,000 to $10,000, reducing administrative burden and aligning with common capitalization policies:
- Equipment threshold increased to $10,000.
- Supplies threshold increased to $10,000 for remitting unused supplies under 2 CFR 200.314(a).
- Special purpose equipment prior written approval threshold increased to $10,000.
- Indian Tribes may dispose of equipment in accordance with Tribal law.
OMB also provided flexibilities indicating that all entities may use the revised $10,000 equipment threshold and that Tribes may use their own procurement standards. With mixed award populations, document your approach and apply it consistently.
Internal Controls
Cybersecurity is Explicitly Included
The revisions clarify that recipient and subrecipient internal controls include cybersecurity and other measures to safeguard information. For many organizations, the practical question is whether internal controls and documentation are sufficient over systems supporting federal award compliance, including:
- Vendor setup and purchasing approvals
- Timekeeping and payroll allocations charged to grants
- Grant reporting and performance data
- Storage/access controls over procurement and subaward documentation
A pragmatic approach is to identify where key data resides, who can change it, and what evidence exists that changes/approvals are controlled.
Subrecipient Monitoring
Classification Judgment and SAM.gov Verification
Pass-through entities should focus on two recurring risk areas:
- Subrecipient vs. contractor determinations: the substance of the relationship is more important than the form of the agreement; judgment is required and should be documented.
- SAM.gov verification: pass-through entities must confirm potential subrecipients are not suspended, debarred, or otherwise excluded (and retain evidence).
Common findings occur when monitoring is performed but not documented, or when subaward files are missing risk assessments, monitoring plans, evidence of review, or follow-up on subrecipient audit results.
Indirect Costs
Updates and Administrative Clarifications
Key updates include:
- De minimis rate increased to up to 15 percent; entities should not recover more than actual indirect costs incurred.
- Pass-through entities must accept federally negotiated indirect cost rates for subrecipients.
- Neither federal agencies nor pass-through entities may require a de minimis rate lower than the standard.
- Interagency services clarification: allowable charges may include direct costs plus a prorated share of indirect costs; in certain situations a 15 percent standard rate on direct salaries and wages may be used.
- Closeout reporting clarified when final indirect cost rates are not yet established, including an additional final report when the rate is finalized.
- Subrecipients must certify to pass-through entities that submitted financial information is complete and accurate.
Historical Problem Areas Still Driving Findings in 2026
Even with strong policy updates, Single Audit findings frequently arise from recurring compliance and accounting execution gaps. As you approach year-end, consider these common areas.
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Many major programs include eligibility requirements for participants, beneficiaries, or subrecipients. Findings often occur when:
- Eligibility criteria are met but the supporting documentation is incomplete or not retained.
- Eligibility determinations are performed inconsistently across departments or locations.
- Required periodic recertifications are missed.
Actions now:
- Identify programs with eligibility compliance requirements and confirm the specific documentation expected (checklists, source documents, certifications).
- Standardize the eligibility file and perform an internal spot-check before year-end.
- Ensure retention practices are clear, especially when systems or staff changed mid-year.
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Late or inaccurate financial/performance reports remain a frequent compliance issue.
Examples include:
- Federal or pass-through reports not agreeing to the general ledger.
- Reporting based on budget rather than actual expenditures.
- Inconsistent treatment of program income or matching costs.
- Missed deadlines that create compliance and monitoring concerns.
Actions now:
- Create a reporting calendar with clear ownership and backup coverage.
- Reconcile reported amounts to the GL before submission and retain that reconciliation.
- Align supporting schedules for drawdowns, expenses, and match to reduce last-minute corrections.
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Due from grantor, deferred revenue, and rollforwards Grant accounting issues often surface in the form of:
- Unexplained or unsupported due from grantor balances.
- Deferred revenue balances that do not roll forward correctly.
- Grant receivables recorded without a clear basis for collectability.
- Inconsistencies between grant schedules, the GL, and the SEFA.
Actions now:
- Maintain grant-by-grant rollforwards of receivables, deferred revenue/unearned revenue, and revenue recognition methodology.
- Reconcile grant schedules to the GL at least quarterly (monthly where volumes are high).
- Ensure receivable balances can be tied to specific submitted/approved requests, allowable costs, and timing of reimbursements.
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Even when costs are allowable, delayed billing/drawdowns and slow collections create audit and financial reporting issues:
- Aging grant receivables may require evaluation under your accounting framework (including allowance considerations where applicable).
- Late drawdowns can cause cash flow stress and increase the risk of missing reporting and closeout deadlines.
- Delayed reimbursement can complicate revenue recognition and year-end cutoff.
Actions now:
- Track drawdowns and reimbursement requests by award and aging category.
- Investigate old reconciling items promptly (e.g., rejected draw requests, missing documentation, inactive awards).
- Coordinate program staff and finance to resolve compliance or performance issues that delay reimbursement.
Quick Readiness Checklist for June/September Year-Ends
- Map Award Population: Identify awards issued on/after 10/1/2024 (revised Subparts A–E) vs. older awards.
- Procurement Readiness: Confirm policy alignment to practice; standardize files; train staff; spot-check documentation.
- Consistent Thresholds: Implement and document $10,000 thresholds where applicable; ensure consistent treatment across purchasing and fixed assets.
- Subrecipient Monitoring: Document classifications; retain SAM.gov checks; maintain monitoring evidence.
- Internal Controls and Cybersecurity: Confirm basic access and safeguarding controls for systems supporting federal award administration.
- Indirect Costs: Confirm de minimis vs. negotiated rate approach; ensure pass-through practices align with updated requirements.
- SEFA and Audit Planning: Start early; confirm whether you exceed the $1.0M Single Audit threshold and anticipate Type A impacts.
- Address Recurring Risks: Eligibility files, reporting timeliness/accuracy, and grant accounting rollforwards and collectability.
Translate Uniform Guidance Changes into Policy, Tools, and Audit-Ready Processes
REDW’s Audit & Assurance advisors are Single Audit Certified by the AICPA and work extensively with Tribal governments, healthcare organizations, state and local governments, and nonprofit organizations subject to Single Audit. We help clients translate Uniform Guidance changes into practical policy language, procurement documentation tools, and audit-ready processes — and we provide readiness assessments focused on common finding areas such as procurement, eligibility, reporting, and grant accounting reconciliations.
For Tribal Nations looking to build compliance confidence across their finance and grants teams, our customizable Uniform Guidance Training program is a practical starting point. Ready to talk through your organization’s readiness?
Author Biography — Meet Chris
Christopher Tyhurst, CPA, has been in public accounting since 1994. He joined REDW in 1996 and became a Principal with the firm in 2008. Chris is very involved in the Firm’s Tribal practice, as well as its healthcare industry service team. He also serves as Quality Management Director of the Audit & Assurance practice.
Chris has extensive experience auditing nonprofit and Tribal healthcare organizations. He has also provided many other financial and strategic consulting services to tribes, including internal controls, enterprise board training, financial forecasts, and staff training on accounting and federal grant management topics. And for more than a decade, Chris spearheaded and served as Conference Chair for REDW’s annual Tribal Finance & Leadership Conference.
He has also developed a broad base of knowledge in the healthcare industry by performing financial audits and consulting with many hospitals and healthcare organizations in the areas of patient accounts receivable and internal controls. A Past-President of the New Mexico chapter of the Healthcare Financial Management Association (HFMA), Chris has presented at regional HFMA conferences on accounting and financial reporting matters, as well as risk assessment and internal controls.
