OMB issues 2007 Compliance Supplement.(Office of Management and Budget)

OMB issued its annual OMB Compliance Supplement in May, effective for fiscal years ending June 30, 2007.

The 2007 Compliance Supplement can be downloaded at www.whitehouse.gov/omb/grants/grants_circulars.html in either PDF or Word format. I personally prefer the PDF format as it prints out the same regardless of the printer used. However, if you want to make changes to the compliance supplement for your workpapers, then the Word version is more appropriate.

The Compliance Supplement contains seven parts and several appendices. One appendix in particular, Appendix V, discusses the changes in the 2007 Compliance Supplement. I have summarized those changes for you by part number, as well as provided some information on the nature of the particular part and guidance on implementing it.

Table of Contents

Below is a summary of the new and eliminated programs in the Compliance Supplement as well as changes to the Clusters (Part 5).

Part 1: Background, Purpose, and Applicability

This section is updated for the effective date of fiscal year ending June 30, 2007 and later.

Special waivers and provisions adopted as the result of Hurricane Katrina and Rita have also been revised.

This provides general background material related to the Compliance Supplement, such as what it is and why it was issued. This section clearly informs the auditor that the supplement is not a "safe harbor." The auditor can't simply follow the supplement and expect to be in compliance with the various program requirements. The auditor always has a responsibility to follow the latest program requirements, which may not be in the Compliance Supplement. With that said, the auditor can normally expect the Compliance Supplement to be current since it is updated once a year. Prior to 1996, the supplement was not updated annually and often out of date. This is rarely the case in more recent years.

Part 2: Matrix of Compliance Requirements

This includes an updated matrix to add and remove programs to make the matrix consistent with the Table of Contents and Part 4 (Agency Program Requirements).

CFDA 10.500 added applicability of subrecipient monitoring. CFDA 10.665 and 10.666 removed applicability of the "Davis-Bacon Act."

This matrix, which is updated annually, lists the main (but not all) federal programs with an indication of which of the 14 compliance requirements (found in Part 3) may be applicable to the programs. While this matrix is a guide, it is not authoritative, as evidenced by the note on page 2-9: "Yes, this type of compliance requirement may apply to the Federal program." However, just because it may apply does not mean that it does apply. Auditors should use caution in following …