In a move that will redefine the landscape of federal financial assistance, the White House, on April 4, 2024, announced a landmark revision to the Office of Management and Budget (OMB) Guidance ten years after the introduction of the original Uniform Guidance (Section 2 C.F.R. 200). This overhaul, aimed at enhancing clarity for recipients of federal funds, marks a significant stride toward greater transparency and accessibility in government funding operations. Among the highlights are increased single audit thresholds for nonprofits, simplified funding applications, raised equipment purchase limits, and crucial terminological standardization to prevent interpretational disparities across Federal agencies, all paving the way for more efficient and effective fund management.
Here is a rundown of the changes impacting nonprofit organizations:
- The single audit threshold will be increased from $750,000 to $1,000,000
- Pre-award changes to Notices of Funding Opportunities (NOFOs) to simplify the application process
- Equipment purchased using Federal funds will have an increased threshold from $5,000 to $10,000
- Revise and clarify Uniform Guidance language to standardize terms, enhance clarity in cost principles, and simplify processes for fund recipients
- Exclusion of subaward costs increased from $25,000 to $50,000 for modified total direct costs
- Clarification that the exclusion for subaward costs in excess of the defined threshold should be applied without regard to the period of performance, thus eliminating ambiguity around the threshold being applied on an annual basis for award recipients and subrecipients
- Improvements to access and support for programs for Tribal nations
OMB directs all federal agencies to implement the revisions no later than October 1, 2024, and they are to report their implementation plans to OMB by May 15, 2024. The full pre-publication version of the final guidance can be found here.
As this will result in wide-sweeping changes to various financial and award management aspects, the Nonprofit Group at CBIZ will provide guidance and updates as the changes progress.
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