OMB Circular A-133 Information Collection Under OMB Review

AGENCY:

Office of Management and Budget.

ACTION:

Notice of submission for OMB review, comment request.

SUMMARY:

In accordance with the Paperwork Reduction Act of 1980, as amended (44 U.S.C. 3501 et seq.), this notice announces that an information collection request was submitted to the Office of Management and Budget's (OMB) Office of Information and Regulatory Affairs (OIRA) for processing under 5 CFR 1320.10. The first notice of this information collection request, as required by the Paperwork Reduction Act, was published in the Federal Register on August 15, 2003 (68 FR 48960). The information collection request involves two proposed information collections from two types of entities: (1) Reports from auditors to auditees concerning audit results, audit findings, and questioned costs; and (2) reports from auditees to the Federal government providing information about the auditees, the awards they administer, and the audit results. These collection efforts are required by the Single Audit Act Amendments of 1996 (31 U.S.C. 7501 et seq.) and OMB Circular A-133, “Audits of States, Local Governments, and Non-Profit Organizations.” Circular A-133's information collection requirements apply to approximately 30,000 States, local governments, and non-profit organizations on an annual basis.

DATES:

Submit comments on or before April 12, 2004. Late comments will be considered to the extent practicable.

ADDRESSES:

Due to potential delays in OMB's receipt and processing of mail sent through the U.S. Postal Service, we encourage respondents to submit comments electronically to ensure timely receipt. We cannot guarantee that comments mailed will be received before the comment closing date.

Electronic mail comments may be submitted via the Internet to ahunt@omb.eop.gov. Please include “Form SF-SAC Comments” in the subject line and the full body of your comments in the text of the electronic message and not as an attachment. Please include your name, title, organization, postal address, telephone number and E-mail address in the text of the message. You may also submit comments via facsimile to 202-395-7285.

Comments may be mailed to Alexander Hunt, Office of Information and Regulatory Affairs, OMB, 725 17th Street, NW., Room 10236, Washington, DC 20503.

FOR FURTHER INFORMATION CONTACT:

For further information, contact Elizabeth C. Phillips, Office of Federal Financial Management, Office of Management and Budget, 202-395-3053 (direct) or 202-395-3993 (main office) and via e-mail: ephillip@omb.eop.gov. The data collection form, SF-SAC, and its instructions can be obtained by contacting the Office of Federal Financial Management, as indicated above or by download from the OMB Grants Management home page on the Internet at http://www.whitehouse.gov/omb/grants by selecting the “Forms” option.

SUPPLEMENTARY INFORMATION:

A. Background

OMB Control No.: 0348-0057.

Title: Data Collection Form.

Form No: SF-SAC.

Type of Review: Revision of a currently approved collection.

Respondents: States, local governments, non-profit organizations (non-Federal entities) and their auditors.

Estimated Number of Respondents: 62,400.

Estimated Time per Respondent: 59 hours for each of 400 large respondents and 17 hours for each of 62,000 small respondents for estimated annual burden hours of 1,077,600.

Estimated Number of Responses per Respondent: 1.

Frequency of Response: Annually.

Needs and Uses: Reports from auditors to auditees and reports from auditees to the Federal government are used by non-Federal entities, pass-through entities, and Federal agencies to ensure that Federal awards are expended in accordance with applicable laws and regulations. The Federal Audit Clearinghouse (FAC) (maintained by the U.S. Census Bureau) uses the information on the SF-SAC to ensure proper distribution of audit reports to Federal agencies and to identify non-Federal entities who have not filed the required reports. The FAC also uses the information on the SF-SAC to create a government-wide database which contains information on audit results. This database is publicly accessible on the Internet at http://harvester.census.gov/fac/. It is used by Federal agencies, pass-through entities, non-Federal entities, auditors, the General Accounting Office, OMB, and the general public for management and information about Federal awards and the results of audits.

B. Public Comments and Responses

Pursuant to the August 15, 2003, Federal Register notice, OMB received 17 comment letters relating to the proposed revision to the information collection. Letters came from State governments (including State auditors), certified public accountants (CPAs) at two national accounting firms, and three Federal agencies. The comments received relating to the information collection and OMB's responses are summarized below.

General

Comments: Six comments were in favor of the proposed changes. General comments included concerns about the clarity of the instructions and an overall concern with the DUNS numbers requirement.

Electronic Submission

Comments: Six States endorsed the proposed procedure to allow electronic submission of the reporting package and Form SF-SAC. Two State auditors and the AICPA expressed concern over the limitation on the number of PDF files in electronic submissions.

Response: All suggestions offered will be given consideration during the development phase. However, standardization of electronic submission is necessary to allow the FAC to develop an automated procedure to process and manage the submissions.

Addition of DUNS numbers

Comments: Five State auditors and the AICPA found the instructions confusing or unclear about different issues. The main concerns centered on questions about why DUNS are required, which DUNS numbers are required to be reported, and the reporting burden.

Response: The intent of this item is to capture only the DUNS numbers related to Federal award applications submitted on or after October 1, 2003. DUNS numbers are collected to tighten Federal oversight of Federal award expenditures. The instructions have been re-worded to clarify the intent of the question.

Auditor Information

Comment: One State auditor commented that it is not clear whether Federal agencies are interested in knowing of the additional audit organizations that participated in the audit of Federal programs, or in knowing of all additional audit organizations, including those that participated in the financial statements audit for departments in which no Federal programs were tested. The commenter felt the instructions should more clearly describe which additional audit organizations must be included.

Response: Agree. The form instructions for part I, item 7(g) were revised to clarify this.

Auditor Certification

Comments: One commenter noted that the auditor statement should be revised as follows: “The information included in Parts II and III of the Form, except for Part III, Items 7, 8, and 9a through 9e, was transferred from the auditor's report(s) for the period ***”

Response: Agree. The auditor certification statement was corrected.

Financial Statements-Type of Audit Report

Comment: Two auditors commented that the type of audit report for financial statements (part II, item 1) should allow the auditor to select any combination of responses that apply to all the differing types of opinions that have been issued, including unqualified opinions.

Response: Agree. The instructions were revised to allow any combination of responses for this item (financial statements). Major programs, however, are still limited to only one opinion for each program as a whole (including clusters).

Statement in Auditor's Report

Comment: The AICPA commented that part III, item 1 refers to AICPA SOP 98-3. That SOP was recently replaced by an AICPA audit guide titled, Audits of States, Local Governments, and Not-for-Profit Organizations Receiving Federal Awards.

Response: The form and form instructions have been revised.

Dollar Threshold To Distinguish Type A and Type B Programs

Comment: Three comments noted an error in the instructions. The dollar threshold used to distinguish between Type A and Type B programs did not change to $500,000.

Response: Agree. The minimum threshold to distinguish between Type A and Type B programs remains $300,000. The form instructions were corrected.

Reporting Packages

Comment: One State auditor commented that hard copy submissions of reporting packages should no longer be required.

Response: Submission of reporting packages are still required. However, more options will be available. The Federal Audit Clearinghouse is developing a procedure to permit auditees to submit either an electronic version of the reporting package or the appropriate number of hard copies. The form instructions were changed to direct those interested in an electronic submission to the FAC Web site for further instructions.

Federal Awards Reporting (Form Page 3)

Comment: One Federal agency commented that requiring awardees to separately input this information into the Federal Audit Clearinghouse database for each CFDA number could create an unnecessary administrative burden on the awardees.

Response: OMB has determined that the most effective way to capture the Schedule of Federal awards and the auditors' findings is to require the respondents to compile the information in the data collection form. The alternative is to require the Federal Audit Clearinghouse to interpret and type the information from each of the different 35,000 audit reports received annually into its database. It is deemed unreasonable to expect the Federal Audit Clearinghouse staff to accurately interpret so many different audit reports. It is more reasonable that the auditor should be able to more accurately translate its report into the standardized format on the SF-SAC.

Comment: The Instructions for Completing Form SF-SAC do not explain what to use as the name of the Federal program in column 9(c) if the Federal program is not in the CFDA.

Response: Additional instructions have been added for clarification.

Comment: One State auditor commented that it is not clear what benefit is gained by being able to show more than one opinion if there is not any information as to what an other-than-unqualified opinion pertains to. It is a burden to make an additional entry to code the opinion on each line.

Response: To provide better oversight, the Federal agencies requested that the type of audit report for each major program be captured on the data collection form. Because large auditees use spreadsheet uploads of the Federal award data on page 3 of the form, OMB disagrees that the burden of entering a letter on each line for each major program is a significant burden.

Comment: One commenter was not certain how type of audit information should be entered. Specifically, should the auditor enter the required information (major program and type of audit report) relating to the CFDA number in its entirety on the first line and leave the other line(s) blank or would they repeat the entry on every line?

Response: Each line must be completed. The instructions have been revised to clarify this.

Comment: One State auditor was not certain how to report a departure from an unqualified opinion on a major program cluster if the opinion is not related to all programs in the cluster. Specifically, what should be entered in the box for the programs not causing the departure from an unqualified opinion?

Response: The type of audit report for a major program must apply to the whole program. All programs in a major program cluster should have the same type of audit report.

Editorial

Comment: One commenter stated that additional guidance should be given auditors who will discover both Federal Emergency Management Administration (FEMA) grants and Department of Homeland Security (DHS) grants in the same audit year.

Response: The Catalog of Federal Domestic Assistance, Appendix VII “Historical Profile of Catalog Programs” provides a historical index to changed CFDA numbers ( http://www.cfda.gov/ ). When new DHS CFDA numbers replace FEMA CFDA numbers, auditees should rely on the Catalog and its historical index. Until the Catalog is revised, FEMA awards should be reported using the original CFDA numbers.

Form Instructions

Comment: One Federal agency commented that the form instructions need to more clearly indicate the SF-SAC is not to be used by commercial organizations.

Response: Agree. The form instructions have been revised. A note was added on the first page of the instructions.

Comment: One auditor stated that the current instructions are too vague regarding the date the form is due. A better explanation is requested in the form instructions

Response: Agree. The form instructions were revised to denote the due date formula.