There has been confusion about the applicability of Single Audits for recipients of federal dollars through the Restaurant Revitalization Fund (RRF) and Economic Injury Disaster Loans (EIDL) programs. Our team understands this as federal guidelines for COVID-19 relief funding have been developed simultaneously as the new funding streams have emerged. This simultaneous development has resulted in guidelines and conversations that have been much more fluid than what you would typically see related to federal funding programs, resulting in questions that have emerged along the way.

Due to recent clarifications of federal guidelines associated with RRF and EIDL funding, all recipients of RRF funding and for-profit entity recipients of EIDL funding should not include RRF expenditures or EIDL awards in their calculation of federal expenditures for each reporting period. This will likely result in a large number of for-profit companies that will not be subject to Single Audit requirements that otherwise may have been before the release of clarified guidelines. Nonprofit entities who have received EIDL funding should include the funding in their calculation of federal expenditures and will be subject to a Single Audit if total expenditures during the reporting period are greater than $750,000.

This is great news for many organizations that may have otherwise been required to undergo a Single Audit for the first time given the increased time and effort that would be required. However, as the guidelines continue to be developed for existing federal funding streams (the Shuttered Venue Operators Grant, for example), new federal funding streams may still emerge. Note: EIDL funding for nonprofits is still included in annual federal expenditure calculations for Single Audit eligibility.

Count on us to communicate updates as they arise. If you have any questions on the eligibility of your organization or any other applicable matters please reach out to a member of GBQ’s Restaurant Team.


Article written by:
Tobin Perrill
Senior Manager, Assurance & Business Advisory Services

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Tags: Audit/GAAP