The $1 Million Single Audit Threshold: What Nonprofit Finance Firms Should Know

The short version

• A nonprofit that expends $1,000,000 or more in federal awards during its fiscal year must have a Single Audit, or in limited cases a program-specific audit (2 CFR 200.501(a) and (b)).
• The $1,000,000 threshold applies to fiscal years beginning on or after October 1, 2024. Fiscal years that began earlier use the former $750,000 threshold.
• An organization that expends less than $1,000,000 in a fiscal year is exempt from federal audit requirements for that year, with limited exceptions, but its records must still be available for review by the federal agency, the pass-through entity, and the GAO (2 CFR 200.501(e)).
• The test is federal awards expended, not federal awards received or announced.

What changed, and when it applies

In April 2024, the Office of Management and Budget revised the Uniform Guidance at 2 CFR Part 200. Among other updates, it raised the Single Audit threshold from $750,000 to $1,000,000. The Federal Audit Clearinghouse states the rule by fiscal year start date:

What that means for common year ends:

• Calendar year (January 1 start): the year beginning January 1, 2025 is the first at $1,000,000.
• June 30 year end: the year that began July 1, 2024 still used $750,000. The year beginning July 1, 2025 is the first at $1,000,000.
• September 30 year end: the year that began October 1, 2024 and ended September 30, 2025 is the first at $1,000,000.

Expended, not awarded

This is the detail that matters most for prospect research. Under 2 CFR 200.502, a federal award counts as expended when the related activity occurs. That generally includes:

• Expenditure and expense transactions under grants and cooperative agreements
• Disbursements of funds to subrecipients
• Use of loan proceeds under federal loan programs
• Receipt of property and noncash assistance, valued at fair market value
• Receipt or use of program income

A few practical consequences:

• A multi-year award does not count all at once. A $1.5 million award spread over three years may produce roughly $500,000 of expenditures in a given year.
• Funds received as a subrecipient through a state or another nonprofit generally count (2 CFR 200.501(g)). Payments received as a contractor for goods or services generally do not.
• Medicare patient care payments are not federal awards expended for this purpose. Medicaid payments generally are not either, unless a state requires them to be treated that way (2 CFR 200.502(h) and (i)).

So a headline award announcement is a starting point, not a conclusion.

What a Single Audit asks of the nonprofit

When the threshold is met, the organization must submit a reporting package and a data collection form to the Federal Audit Clearinghouse (2 CFR 200.512). The reporting package includes:

• Financial statements and the schedule of expenditures of federal awards
• A summary schedule of prior audit findings
• The auditor's reports
• A corrective action plan

Timing: the submission is due within 30 calendar days after the organization receives the auditor's reports, or nine months after the end of the audit period, whichever is earlier. A senior official, such as the executive director or chief financial officer, signs a certification as part of the data collection form. The Federal Audit Clearinghouse makes reporting packages publicly available, with narrow exceptions.

Why this matters to nonprofit finance firms

The threshold is useful because it marks a change in what an organization's finance function has to carry. Three situations are worth watching.

1. Approaching the threshold for the first time. A growing organization that moves toward $1,000,000 in annual federal expenditures may need a reliable schedule of expenditures of federal awards, expenditure tracking by program, documented internal controls over compliance, and an audit-ready close. Some teams build that in house. Many look for outside controller, CFO, or grants compliance help.
2. Sitting near the line. Because the threshold rose, some organizations that needed a Single Audit at $750,000 may not need one at the same spending level today. They still have grant compliance, documentation, and reporting obligations, and state rules or funder terms may set their own audit requirements. The conversation shifts from audit readiness to sound grant accounting.
3. Public findings. Single Audit reports filed with the Federal Audit Clearinghouse can include findings such as significant deficiencies or material weaknesses, along with the organization's corrective action plan. A documented finding is a factual signal that a control area needed attention. It is not proof that the organization is looking for outside help.

How to read the signal responsibly

We label every material claim in our research as Verified, Inferred, or Unknown, and we recommend the same discipline for any firm using public data.

• VerifiedWhat a primary source states, such as an award amount and period in USAspending, a fiscal year in a Form 990, or a finding in a filed audit.
• InferredA reasonable reading of those facts, such as "federal expenditures are likely to rise next year based on a new multi-year award."
• UnknownWhat public data cannot tell you, such as current staffing, existing advisers, or budget for outside help.

Some practical rules follow from that:

• Do not tell a prospect they "now need a Single Audit." You rarely know their expenditures for the current year. Ask how they are planning for it instead.
• Do not treat a new award as cash in hand, a staffing problem, or buying intent.
• Reference public facts plainly and let the organization fill in the rest.

A short research checklist

1. Fiscal year start date, from the organization's most recent Form 990.
2. Total federal expenditures, from the schedule of expenditures of federal awards in its latest Federal Audit Clearinghouse filing, if one exists.
3. New and continuing awards, with periods of performance, from USAspending.
4. Prior findings and corrective action plans, from the Federal Audit Clearinghouse.
5. Finance leadership and capacity signals, from Form 990 Part VII and the organization's own website.

How AwardNote uses this

Sources

All retrieved October 16 to 17, 2026.

• 2 CFR 200.501, Audit requirements (eCFR): ecfr.gov
• 2 CFR 200.502, Basis for determining federal awards expended (eCFR): ecfr.gov
• 2 CFR 200.512, Report submission (eCFR): ecfr.gov
• Federal Audit Clearinghouse, eligibility and thresholds: fac.gov
• HHS Office of Inspector General, Single Audits FAQs: oig.hhs.gov
• New York State Education Department, threshold by fiscal year start: nysed.gov

FAQ