In a nutshell:
- The outstanding beginning balance of HUD-insured or HUD-held mortgages, USDA Mortgage, USDA Section 538 Mortgage
- The outstanding beginning principal balance of a USDA Mortgage, a mortgage
- The original amount of 202/811 capital grants
- Project-based rent subsidies received during the year
- Interest reduction payments receiving during the year
- Retained excess income
- Other federal grants received during the year (e.g. service coordinator)
[Information originally obtained from HUD’s Financial Assessment of Multifamily Housing (FASS-MF) Page. This page is no longer active on HUD’s site. The basic information remains relevant]
Clarification of Notice H2013-23
Housing Notice H2013-23 allows profit-motivated owners that receive less than $500,000 [Non-profit that receive less than $750,000] in combined federal financial assistance to file owner-certified financial statements in lieu of audited statements. The $500,000 profit-motivated [$750,000 non-profit] threshold applies to owning entities and not to individual projects. If an owner owns more than one HUD assisted project then the federal awards threshold would apply to all Section 8 contracts and HUD mortgages owned by the entity. Combined federal financial assistance is calculated the same as it is for OMB A133 nonprofit audits. Instructions for the calculation can be found here.
[Information originally obtained from From HUD’s REAC>Single Audit Act Page. This page is no longer active on HUD’s site. The basic information remains relevant]
DID YOU KNOW that $500,000 (profit motivated) / $750,000 (non-profit) is made up of more than expenditures?
Important! The Office of Management and Budget has issued a revision to Circular A-133, Audits of State and Local Governments for Non-Profit Organizations increasing the audit threshold from $300,000 to $500,000 $750,000  of Federal Awards for Fiscal Year ending after December 31, 2003. (03/22/04)
In order to comply with OMB Circular A-133 standards, all PHAs and non-profit Multifamily Projects expending $500,000 $750,000  or more in Federal funds must have an independent audit conducted by an IPA. (03/22/04)
To determine whether your PHA or non-profit Multifamily Project has expended more than $500,000 $750,000 , you should consult the definition of Federal government expenditures according to A-133. (03/22/04)
According to OMB Circular A-133, Section .205(d), loans and loan guarantees for the proceeds of which were received and federal awards for which the proceeds were received and expended in prior years are still considered to be expended in the current year if the laws, regulations, and the provisions of contracts or grant agreements impose continuing compliance requirements. Thus, OMB Circular A-133 requires independent audits conducted by an IPA as long as you must comply with provisions in your regulatory agreement in addition to the repayment of the loan. Capital grants are also included in this calculation of Federal funds.
To assist you in determining if your PHA or Non-Profit Organization is required to have an independent audit in accordance with OMB Circular A-133, we have designed the following questionnaires These questionnaires have not been updated to reflect the change from $500,000 to $750,000.
These questionnaires are intended to provide assistance in making the determination, however, you should obtain and review the requirements in OMB Circular A-133 to ensure your determination of total federal expenditures is complete and accurate.
- Basis for Determining Federal Awards Expended (CFR § 200.501 Audit Requirements for entity’s that expend $750,000 or more. CFR § 200.502 Basis for determining federal awards expended)
- The Q & A session for our December 2014 conference covered a question regarding the $750,000 threshold.
 The Office of Management and Budget (OMB) has raised the threshold for compliance audits of entities that receive federal award money from $500,000 per fiscal year to $750,000 per fiscal year.