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Key Performance Indicators Nonprofit Leaders Should Track

By Jeffrey A. Kowalczyk, CPA, CFE, CGAP

Key performance indicators nonprofit leaders should track

At the beginning of the pandemic, many nonprofit organizations saw a sharp decline in donations and participation. Amidst the uncertainty, donations dropped by up to 17 percent in April, May, and June. While the downward trend eventually reversed, and donations ended the year two percent above 2019 numbers, the decline brought to light the need for nonprofits to maintain a close eye on key performance indicators (KPIs).

KPIs are metrics leaders have prioritized, are updated regularly, and serve two functions. First, they provide nonprofit leaders the opportunity to keep an eye on the health of the organization. Second, they can be used to help new and existing donors decide where their finite resources are best contributed. Donors want to support a cause they care about, but they also want to know how their funds are being used.

This article will explore which KPIs are essential to track and how to calculate them.

Track these KPI’s

There is a seemingly limitless supply of ratios you can track when it comes to finances; however, the following ratios are often indicators of nonprofit organization health and financial impact.

  • Current ratio: This ratio allows organizations to see their ability to pay short-term organizations. Experts recommend this is at least 1:1  for most organizations.
    • Calculation: current assets/current liabilities
  • Liquidity: Your liquidity ratio allows leaders to understand how flexible they can be in a crisis or if a new opportunity emerges. Much like personal budgeting, experts recommend having 3-6 months in cash reserves.
    • Calculation: cash on hand/average monthly expenses
  • Administrative expenses: Tracking the percent of funds that go towards administrative costs will allow you to decide if you’re spending too much on administrative costs. This should be below 20 percent.
    • Calculation: management, administrative, and general expenses/total expenses
  • Program efficiency: On the other side of administrative expenses, program efficiency lets leaders and donors know how much of their donation is going toward actual charitable programs. Experts recommend staying around 75 percent.
    • Calculation: program service expenses/total expenses
  • Fundraising expenses: Fundraising is necessary to bring donations into a nonprofit, but it should not cost more than the funds you bring in. There are two ways nonprofits generally report fundraising expenses:
    • 1. Fundraising costs unrelated to special fundraising events. This is reported on the statement of functional expenses as fundraising expenses. This figure is generally less than 20 cents per contribution dollar.
    • 2. Fundraising costs directly related to special fundraising events. This is reported as a contra-revenue and will often be higher than 20 percent of event revenues, depending on the nature of the event. Organizations should perform year-over-year comparisons of event revenues to event expenses to ensure events continue to serve the organization’s needs.
  • Recurring unrestricted revenues: Knowing the total amount of recurring income allows a nonprofit organization to better budget each year.
    • Total of any recurring income, not including one-time grants, gifts, and contributions.
  • Liabilities to assets: When used correctly, debt can be helpful. However, too much debt can eventually catch up with an organization and cause problems. Debt should not be more than 50 percent of your assets.
    • Calculation: total liabilities/total assets
  • Full-cost coverage: If the building your organization owns needs repairs or if any equipment needed replacing, is your organization prepared for the cost? Budgeting for the depreciation of the assets and payment of debt principal allows organizations to have cash on hand when equipment needs replaced.
    • Calculation: add in the cost of depreciation, payments to debt principal, and a surplus when calculating annual budgets.

Knowing you are on the right track

In addition to tracking the KPI’s for your nonprofit organization, having a benchmark can help leaders know they are on the right track. Start by monitoring against your previous years’ data. This will allow you to see when you are growing or need to work harder in a specific area. Second, identify three to five comparable nonprofit organizations and track your KPI’s against theirs regularly. Form 990 for nonprofit organizations is public record, which means you can pull their reports every year and compare your organization’s performance to theirs.

Key performance indicators are an excellent way for business leaders of all kinds, especially nonprofit organizations, to monitor the health of their organization and determine what areas need more focus. We can help your nonprofit establish, understand, and track its KPIs. Give us a call today!

Also read our blog article 

About Barbacane, Thornton &

Company LLP

Barbacane, Thornton & Company LLP is a highly regarded, regional
certified public accounting and consulting firm specializing in auditing and
tax services for government agencies and nonprofits. For more information about
Barbacane, Thornton & Company LLP, please call (302) 478-8940 or visit


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What You Need to Know About the Employee Retention Credit

What You Need to Know About the Employee Retention Credit

By Steven Kutsuflakis CPA

What You Need to Know About the Employee Retention Credit                                    

The Employee Retention Credit (“ERC”) was created to help employers recover from the government mandated COVID-19 related shutdowns by allowing employers that pay qualified wages including health plan expenses to receive a refundable tax credit of up to $5,000 per employee in 2020 and $28,000 per employee in 2021. 

The ERC was originally enacted under the March 2020 Coronavirus Aid, Relief, and Economic Security Act (“the CARES Act”) and has undergone a series of revisions with the Taxpayer Certainty and Disaster Tax Relief Act of 2020 (“the Relief Act”) enacted in December 2020 and later the American Rescue Plan Act of 2021 (“the American Rescue Plan Act”) enacted in March 2021.

Who is Eligible?

Employers, including tax-exempt entities, are eligible for the credit if they were carrying on a trade or business during the calendar quarter for which the credit is determined and experience either:

  1. the full or partial suspension of the operation of their trade or business during any calendar quarter because of governmental orders limiting commerce, travel, or group meetings due to COVID-19, or
  2. a significant decline in gross receipts when compared to the same quarters in 2019. For the 2021 quarters, a significant decline is defined as less than 80% of gross receipts for the same quarter in 2019. For the 2020 quarters, a significant decline is defined as less than 80% of gross receipts for the same quarter in 2019.

The ERC is not available to the Government of the United States, the government of any State or political subdivision thereof, or any agency or instrumentality of any of the foregoing (governmental entity) with some exceptions.

Qualified Wages

The definition of qualified wages depends on number of employees during 2019. 

If an employer averaged more than 100 full-time employees during 2019 (2020 small eligible employers), qualified wages are generally those wages, including certain health care costs, paid to employees that are not providing services because operations were suspended or due to the decline in gross receipts. These employers can only count wages up to the amount that the employee would have been paid for working an equivalent duration during the 30 days immediately preceding the period of economic hardship.

If an employer averaged 100 or fewer full-time employees during 2019 (2020 large eligible employers), qualified wages are those wages, including health care costs, paid to any employee during the period operations were suspended or the period of the decline in gross receipts, regardless of whether or not its employees are providing services.

The Relief Act provides that large eligible employers are eligible employers for which the average number of full-time employees during 2019 was greater than 500 (2021 large eligible employees).   The Relief Act provides that small eligible employers are eligible employers for which the average number of full-time employees during 2019 was not greater than 500 (2021 small eligible employers).

Exclusion from Qualified Wages

An employer that is eligible for the ERC can claim the ERC even if the employer has received a Small Business Interruption Loan under the Paycheck Protection Program (PPP). The eligible employer can claim the ERC on any qualified wages that are not counted as payroll costs in obtaining PPP loan forgiveness. Any wages that could count toward eligibility for the ERC or PPP loan forgiveness can be applied to either of these two programs, but not both.

Claiming the Credit

As mentioned earlier the ERC is up to $5,000 per employee in 2020 (50% of qualified wages up to $10,000 per employee for all quarters) and $28,000 per employee in 2021 (70% of qualified wages up to $10,000 per employee for each quarter in 2021). 

There are various rules related to claiming the ERC, including circumstances under which an eligible employer may request an advance payment of the ERC. 

Eligible employers can get immediate access to the credit by reducing employment tax deposits they are otherwise required to make. Also, if the employer’s employment tax deposits are not sufficient to cover the credit, the employer may get an advance payment from the IRS.

To claim the ERC, eligible employers will report their total qualified wages and the related health insurance costs for each quarter on their quarterly employment tax returns, which will be Form 941 for most employers.  The credit is taken against the employer’s share of Social Security tax, but the excess is refundable under normal procedures.

In anticipation of claiming the credit, employers can retain a corresponding amount of the employment taxes that otherwise would have been deposited, including federal income tax withholding, the employees’ share of Social Security and Medicare taxes, and the employer’s share of Social Security and Medicare taxes for all employees, up to the amount of the credit, without penalty, considering any reduction for deposits in anticipation of the paid sick and family leave credit.

Eligible employers can also request an advance of the Employee Retention Credit by submitting Form 7200.

Guidance for claiming the ERC can be found at under IRS Notices 2021-20 and 2021-23. 

If you have questions or would like additional assistance in determining whether this funding is available to your Organization, please contact Steven N. Kutsuflakis, CPA, Partner at

About Barbacane, Thornton &

Company LLP

Barbacane, Thornton & Company LLP is a highly regarded, regional
certified public accounting and consulting firm specializing in auditing and
tax services for government agencies and nonprofits. For more information about
Barbacane, Thornton & Company LLP, please call (302) 478-8940 or visit


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Managing Partner’s Message – February 2021

Pamela W. Baker CPA Managing Partner

Who does not love a snowy day? When we were growing up and in school a snow day meant staying home, sledding, hot cocoa, and no homework. Five years ago, it meant major disruption to our schedules and workflows and the resulting crush to make up for time lost at client offices to ensure that work got completed to meet deadlines. This time last year it meant that staff would be able to work from home with little disruption as long as they had thought ahead in order to obtain information from clients. This year our physical office actually closed on the snow day with everyone – even our administrative staff – working effectively at home. A snow day means little change to the majority of our staff who, since last March, have fine tuned the art of being able to work remotely. We still “see” one another – but in a virtual manner with the use of technology. The only difference today is a pretty scenery outside with no hassle to shovel ourselves out.

Just like snow days – so much has changed for everyone. Over the past nine months we have experienced numerous firsts:

  1. A remote work environment
  2. Interviewing potential new hires on Zoom
  3. On-boarding staff remotely
  4. Attending board meetings through technology
  5. Establishing work groups via Microsoft teams
  6. Implementing electronic signature capabilities
  7. Moving administrative functions into a paperless environment
  8. Hosting virtual happy hours
  9. Our first virtual holiday party
  10. Hosting virtual conferences for schools and nonprofits
  11. Presenting at conferences via technology

Some of our firsts have been exciting and new. Others were a little more challenging, but we are so fortunate to have a team of dedicated and highly skilled individuals who did not give in or give up. We also need to pause to give a huge shout out to our clients. Everyone knows that for many people during the pandemic there were lost jobs, decreased sales, unemployment. Those are all real issues. For our clients – the nonprofits and schools and governments – there was never a time when they were not needed more. We have been witness to the dedication and hard work of those that needed to step up. The nonprofit sector has experienced lost revenue from cancelled fundraisers while the need for services has significantly increased. Our public schools have struggled to protect faculty and children while continuing to provide learning opportunities. Our governments had to continue to work to provide public safety, utilities, roads, and other vital services. We are more grateful than ever to be a niche-based CPA firm specializing in services to these essential workers.

We are hopeful that the year ahead will be a time to put the pandemic in the rear-view mirror. We will be excited to enjoy some of the things that had to be modified because of Covid-19 (like dropping into a client office to say Hi). At the same time, we are energized at what we have learned about each other, our clients, and our firm and we are confident that we will be better for it.

Be on the lookout for more virtual training opportunities, continued great service, and a trusted advisor to be here to meet your needs.

Pamela W. Baker, CPA, CGFM

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Exciting News! BTCPA Recently Welcomed A New Partner

Exciting News! BTCPA Recently Welcomed A New Partner
Dependability, integrity, honesty, and commitment are a few of the words our team uses to describe Edmund. Though new as a Partner, Edmund has been with BTCPA since 2009 when he joined after graduating from Goldey-Beacom College with a BS in Accounting in 2008. Edmund continued on to gain a Master’s degree in Business Administration, and became CPA licensed in the State of Delaware.

Edmund quickly became an important team member on several audit engagements, but it was his aptitude to understand the complexities of public housing authorities that soon differentiated him. Over the past eleven years, Edmund has been instrumental in our staff training and mentoring programs. His leadership style is very welcoming to others and he demonstrates on a regular basis that he can balance the needs of clients, the firm, and the quality of our work.

Barbacane, Thornton & Company is a highly regarded, regional certified public accounting and consulting firm specializing in auditing and tax services for government agencies and nonprofits.

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How Artificial Intelligence (AI) Will Improve The Audit Process


How Artificial Intelligence (AI) Will Improve The Audit Process 

How artificial intelligence (AI) will improve the audit process was the subject of a recent article in the Journal of Accountancy.  Our team member, Alex Frank, CPA, offers this summary of the article, and what it means for the future of our business and the way we will be able to use AI to positively impact our clients:

Summary of Article

  • AI can and will remove the need for audit sampling
  • Using Optical character recognition (OCR) the AI can quickly scan large documents (such as contracts, leases, debt agreements) and extract relevant terms or phrases OR the AI can flag an area of the contract that needs further examination
  • At first the AI will make many mistakes that the auditor will have to correct manually, but the AI will learn from those mistakes and make them less and less until there are little to no errors made, thereby improving accuracy and efficiency
  • The AI can also ask the auditor “what should I look for” and the auditor can set specific parameters to look for
  • AI can sort transactions based on the transactions risk based on knowledge obtained from client information and firm risk analysis
    • Allows the auditor to focus professional skepticism on a specific area as opposed to trying to apply it to all areas at an equal level
  • The AI can increase interest in auditing samples
    • Sampling will have a reason for why transactions are selected as opposed to haphazard or random sampling that has no real risk included in the sampling process.
    • The AI will select high risk transactions as a sample and will help teach auditors what is considered high risk and allow them to focus more time to apply judgement to analyze the data in front of them
  • As the AI continues to learn, it will begin to identify patterns and therefore be able to flag any anomalies in the data to help focus the auditor’s attention to riskier areas
  • AI will eventually lead to validation of 100% of client transactions in an almost real time basis
  • Auditors will be able to implement their own AI into a client system
    • The AI will analyze every transaction and journal entry and determine if processes are followed and will flag any transactions made erroneously or incorrectly or transactions that are risky in nature.
    • The AI will flag these transactions to alert the auditor as to what transactions need to be review as the transaction happens
    • This will create a shift from auditing as of the balance sheet date (historical data) to a form of continuous assurance that will take place as the transactions occur

How AI can apply to BTCPA

  • BTCPA has begun to implement some forms of technology (data analytics) in several of our audit processes.
    • This is a good first step into the world of automating the audit process but is several steps away from AI
  • AI has potential to help optimize some of our more uniform clients
    • Single audits (nonprofits and governments)
      • Search for compliance across entire populations of data
    • Delaware Charter Schools all utilize the same chart of accounts and all data is maintained in the same accounting system
    • Pennsylvania School Districts
      • they all share a common chart of accounts, so AI could analyze them all the same way
    • Small government clients
      • Share a common chart of accounts and all have relatively similar operational costs and revenues
    • Challenges to navigate:
      • Finding an AI technology that we can use and is easier to use from a staff perspective
        • Or learning how to create one
      • Finding a best practice for how to implement the technology
      • Training the AI to fit our client base (time consuming)
      • How would the implementation be viewed from a peer review standpoint?

What the Future looks like – and Why we remain committed to learning more

  • Allows for 100% transaction review of clients
  • Can eliminate the “routine-ness” of the annual audit process and allow for increased risk analysis
    • The annual audit approach would be able to tailor an approach on a per client basis and create a more meaningful analysis of the client data. Therefore, giving the client a more meaningful report more tailored to their activity during the year.
  • AI will eliminate the need to scan through checks or GL detail for samples or transaction details.
    • Instead AI will be able to tell you exactly what transactions we are testing or need to be examined more closely without the monotony.
    • The samples will have MEANING now
    • No more haphazard or random sampling
  • Since AI will automate the sampling process we can spend more time examining data and applying professional skepticism to the most important areas of the engagement.
  • AI will be able to compile client data into a uniform “structure” which will allow us to easily drill down into data and easily determine:
    • Transaction amounts
      • Exact accounts effected by a JE with out having to scan through a GL
    • Quickly determine if the client has a lease we do not have documented
    • Determine if the client has incorrectly coded a revenue or expense
    • Determine where issues exist that would cause the clients equity to not agree to the PY FS
      • No more comparing the CY with the PY and figuring out the difference manually. The AI would be able to compare information it already has on the client, find any discrepancies on its own and notify the auditor what needs to be fixed
    • If AI is implemented at the client and operates in the background, we would essentially eliminate “traditional audits”
      • Audits would not be done after year end examining “old” data
      • Instead, audits would be conducted by the AI on a continuous basis
        • Whenever there is a transaction that the AI identifies as an issue, it will notify the auditors and they would be able to test the transactions as they occur
      • With the impending implementation of Blockchain, AI will become a reality sooner rather than later.
        • AI is already prevalent in our everyday live whether it be Siri, Alexa, or a YouTube recommended video, AI is ever growing and evolving.
      • AI will seem scary at first, but once implemented the AI will streamline almost every step of the audit process
      • The future of Auditing looks different than anything we have ever seen, but it also looks much more efficient, and will allow for a more tailored audit experience for our clients.


Barbacane, Thornton & Company is a highly regarded, regional certified public accounting and consulting firm specializing in auditing and tax services for government agencies and nonprofits.

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IRS Issues Guidance on Payroll Tax Deferral From Presidential Executive Order


IRS issues guidance on payroll tax deferral from presidential executive order

The IRS issues guidance on payroll tax deferral from presidential executive order, Employers can now defer payroll tax withholding on employee compensation for the last four months of 2020 and then withhold the deferred amounts in the first four months of 2021, confirms a recent update from the IRS. President Trump’s memorandum on Aug. 8 gave employers the ability to defer payroll taxes for employees affected by the COVID-19 pandemic to provide financial relief.

The guidance directs that employers can defer the withholding, deposit, and payment of the employee portion of the old-age, survivors, and disability insurance (OASDI) tax under Sec. 3102(a) and Railroad Retirement Act Tier 1 under Sec. 3201 from employee wages from Sept. 1 to Dec. 31, 2020.

Employers must then withhold and pay the deferred taxes from wages and compensation during the period from Jan. 1, 2021, and April 30, 2021, with interest, penalties, and additions to tax to begin accruing starting May 1, 2021. Included in the notice is a line that indicates, if necessary, employers can “make arrangements to otherwise collect the total Applicable Taxes from the employee,” such as if an employee leaves the company before the end of April 2021, but does not provide details on what that entails.

Employees with pretax wages or compensation during any biweekly pay period totaling less than $4,000 qualify for the deferral. Amounts normally excluded from wages or compensation under Secs. 3121(a) or 3231(e) are not included in calculating the applicable wages. The determination of applicable wages should be made on a period-by-period basis.

Organizations may choose whether to enact the payroll tax deferral. We are closely monitoring updates related this and other presidential executive orders and will communicate if more information becomes available. For questions or assistance with this payroll tax deferral, contact us.


Barbacane, Thornton & Company is a highly regarded, regional certified public accounting and consulting firm specializing in auditing and tax services for government agencies and nonprofits.

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Robert Yemola, CPA Named A PICPA Ambassador

Robert Yemola, CPA - Barbacane Thornton CPAsWe are proud to announce that Robert Yemola, CPA, a Supervisor with our firm was named one of 15 firm ambassadors by the Pennsylvania Institute of Certified Public Accountants (PICPA) for 2020. Robert is a graduate of Juniata College where he received his Bachelor of Science in Finance and subsequently his Master of Accounting. He joined our firm in 2015.

PICPA Firm Ambassadors are an elite group of young professionals who serve as a link between their firms, their professional networks, and the PICPA. Appointed by the PICPA, Firm Ambassadors are trained and equipped with resources to help them serve as leaders and foster connections within their firms and professional networks.

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Managing Partner’s Message – July 2020

Pamela W. Baker CPA Managing Partner

When do we move from “unprecedented” to “normal”? In March we labeled all of the following unprecedented: all staff working from home, all audits conducted in a remote environment, a relaxed dress code, attendance at client Board meetings via zoom, observing minutes of Board meetings watching You Tube, executing a client seminar on a virtual platform, and meeting our team member Bob’s new baby girl by way of video on Microsoft teams! Now, 4-1/2 months later we consider these activities to be the way we conduct business and maintain relationships. Many have called the necessary changes our “new normal” or the “new reality”. Looking back on this timeframe, it does not seem to matter how we categorize the pivot, but that we maintain who we are and stay connected to the WHY we do business.

There is significance in what has not changed for our firm. Our core values of Integrity, Quality, and Responsiveness have been at the forefront of our decision making as we work to navigate and help our clients navigate the impact of the pandemic on their internal controls and financial reporting. We define integrity to mean that we do the right thing, for the right reason, the right way and that we are accountable for our actions. Quality is to exceed expectations, always adhere to all professional standards, and to do it right the first time, then double check! Responsiveness means that we work to meet or exceed deadlines and that we are present for our clients as a trusted advisor, friend, and support system.

We have worked to be advanced from a technology perspective for many years. When the shutdown happened, our staff went home fully automated with audit software, Microsoft teams, a client secure portal in place, and access to Zoom to facilitate meetings. We took the opportunity of completing the December year-end audits to learn and explore ways to manage efficiencies and maintain client relationships with the thought that our remote audits would continue. In July we held a virtual seminar to share with our clients the way that remote auditing can work and, in many ways, improve efficiency while maintaining a high level of quality. We are excited to be able to offer a fully integrated remote audit experience to all our clients as we enter our June year-end audit cycle.

We understand the importance and significance of timely audits now more than ever. Many of our nonprofit clients continue to seek grants and funding to help them pivot to meet the pandemic needs of our communities and our school clients struggle to manage the changes in their budgets and financial condition while working to maximize resources to meet the demands of virtual learning and other necessary changes to the way they deliver education opportunity to their citizens. Timely audits will in many instances be the conduit to help demonstrate financial need as well as financial accountability. We take that charge seriously and look forward to continuing our forty-two-year history of providing audit and accounting services to the communities we serve.

Above all else, we are hopeful that our families, clients, friends, and neighbors will be safe and well and that the ravages of the pandemic will subside in the months to come. In the meantime — we are here and ready to serve.

Pamela W. Baker, CPA, CGFM

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Impact of Covid 19 on Single Audit Requirements

By Zeeshan Ali, CPA


The U.S. Office of Management and Budget (“OMB”) issued a memo on Administrative Relief for Recipients and Applicants of Federal Financial Assistance Directly Impacted by the Novel Coronavirus (COVID-19) due to the loss of operations.  The memo brought some misconceptions regarding the single audit submission deadline. Although an extension has been provided, it was granted only to certain entities and does not apply to all recipients.  The Coronavirus Aid, Relief, and Economic Security (CARES) Act provided economic relief to many organizations, however, this raised a question as to whether or not these funds will be subject to the Single Audit requirements, and its impact on the filing requirements. 

Impact of PPP Loans by Not for Profits:

According to the AICPA Governmental Audit Quality Control Center (GAQC), if a Not for Profit organization has obtained loans under the Paycheck Protection Program, these loans will NOT be subject to the Uniform Guidance Single Audit requirements. However, if the Not for Profit organization has obtained loans under the Small Business Administration (SBA) Economic Injury Disaster relief Loan program (EIDL) for COVID-19, these loans will be subject to the single audit and major program determination requirements. The OMB has not yet released the guidance regarding presentation of these loans in the Schedule of Expenditures of Federal Awards and the Catalog of Federal Domestic Assistance (CFDA) numbers though. This results in a series of unanswered questions regarding the compliance requirements, and the audit challenges.

Filing extensions for Not for Profit entities:

The OMB issued M-20-17 on March 19, 2020, which extended the timeline for single audit submission as follows:

  1. Automatic six months extension is granted to NFPs through June 30, 2020 fiscal year ends
  2. Granted to NFPs affected by the crisis caused by the loss of operations and/or increased costs due to Covid 19
  3. NFP entities are required to document the reason for the delay and include this documentation when filing the audit reporting package (it will be important for us to remind clients that they will need to document if they choose to extend beyond their due date)
  4. The U.S Department of Housing and Urban Development (HUD) Real Estate Assessment Center (REAC) has extended filing deadlines for Multifamily Housing Entities audit submissions that are due April 30 and May 31.

Additional guidance for federal agencies:

The memo M-20-11 issued by OMB on March 9, 2020 is intended to provide guidance to federal agencies relating to grant class exceptions in instances where the agency has determined that the purpose of the Federal awards is to support the continued research and services necessary to carry out the emergency response related to COVID-19. The OMB authorized the federal awarding agencies to take the following actions, as they deem appropriate:

  1. Flexibility with SAM registration: Awarding agencies can relax the requirement for active System for Award Management (SAM) registration at time of application in order to expeditiously issue funding.
  2. Flexibility with application deadlines: Awarding agencies may provide flexibility with regard to the submission of competing applications in response to specific announcements, as well as unsolicited applications.
  3. Waiver for Notice of Funding Opportunities (NOFOs) Publication: For competitive grants and cooperative agreements, awarding agencies can publish emergency Notice of Funding Opportunities (NOFOs) for less than thirty (30) days without separately justifying shortening the timeframes for each NOFO. Awarding agencies would still be required to document and track NOFOs published for less than thirty (30) days under this emergency waiver
  4. No-cost extensions on expiring awards: To the extent permitted by law, awarding agencies may extend awards which were active as of March 31, 2020 and scheduled to expire prior or up to December 31, 2020, automatically at no cost for a period of up to twelve (12) months.
  5. Abbreviated non-competitive continuation requests: For continuation requests scheduled to come in from April 1, 2020 to December 31, 2020, from projects with planned future support, awarding agencies may accept a brief statement from recipients to verify that they are in a position to: 1) resume or restore their project activities; and 2) accept a planned continuation award
  6. Allowability of salaries and other project activities: Awarding agencies may allow recipients to continue to charge salaries and benefits to currently active Federal awards consistent with the recipients’ policy of paying salaries (under unexpected or extraordinary circumstances) from all funding sources, Federal and non-Federal. Awarding agencies may allow other costs to be charged to Federal awards necessary to resume activities supported by the award, consistent with applicable Federal cost principles and the benefit to the project.
  7. Allowability of Costs not Normally Chargeable to Awards: A warding agencies may allow recipients who incur costs related to the cancellation of events, travel, or other activities necessary and reasonable for the performance of the award, or the pausing and restarting of grant funded activities due to the public health emergency, to charge these costs to their award.
  8. Prior approval requirement waivers: Awarding agencies are authorized to waive prior approval requirements as necessary to effectively address the response.
  9. Exemption of certain procurement requirements: Awarding agencies may waive the procurement requirements contained in 2 CPR§ 200.319(b) regarding geographical preferences and 2 CPR§ 200.321 regarding contracting small and minority businesses, women’s business enterprises, and labor surplus area firms.
  10. Extension of financial, performance, and other reporting: Awarding agencies may allow grantees to delay submission of financial, performance and other reports up to three (3) months beyond the normal due date.
  11. Extension of currently approved indirect cost rates: Awarding agencies may allow grantees to continue to use the currently approved indirect cost rates (i.e., predetermined, fixed, or provisional rates) to recover their indirect costs on Federal awards. Agencies may approve grantee requests for an extension on the use of the current rates for one additional year without submission of an indirect cost proposal.
  12. Extension of closeout: Awarding agencies may allow the grantee to delay submission of any pending financial, performance and other reports required by the terms of the award for the closeout of expired projects, provided that proper notice about the reporting delay is given by the grantee to the agency. This delay in submitting closeout reports may not exceed one year after the award expires.
  13. Extension of Single Audit submission: Awarding agencies, in their capacity as cognizant or oversight agencies for audit, should allow recipients and subrecipients that have not yet filed their single audits with the Federal Audit Clearinghouse as of the date of the issuance of this memorandum that have fiscal year-ends through June 30, 2020, to delay the completion and submission of the Single Audit reporting package, to six (6) months beyond the normal due date.

As stated in the memorandum, the 13 provisions noted above were addressed to the Federal awarding agencies. However, it is worth noting that several of the provisions permit Federal agencies to relax certain requirements for grantees (that would mean those who receive direct funding). For our clients, we have some who receive Federal funding and many others who receive pass-through funding from State agencies. When planning for our single audits it will be necessary to determine if our pass-through entity has been permitted any of the provisions above from either a Federal or State agency.

Barbacane, Thornton & Company is a highly regarded, regional certified public accounting and consulting firm specializing in auditing and tax services for government agencies and nonprofits.

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