Changes to the Single Audit: What School Districts Need to Know

Changes to the Single Audit: What School Districts Need to Know

In April of 2024, the Office of Management and Budget (OMB) issued significant revisions to Uniform Guidance, updating several administrative, cost, and audit requirements for recipients of federal awards. Effective for fiscal years starting on or after October 1, 2024, these revisions are intended to reduce administrative burdens on award recipients, align with statutory requirements, clarify certain sections of the guidance, and simplify language to improve readability. This article provides an overview of some of the changes to Uniform Guidance and the Single Audit that school districts should be aware of.

Key Changes to Single Audit Requirements

  • Increased Single Audit threshold: The spending threshold for the Single Audit has been raised from $750,000 to $1 million, meaning only school districts that expend $1 million or more in federal funds within the fiscal year will be subject to a Single Audit.
  • Revised type A program determination: The threshold for defining “Type A” programs has also been raised from $750,000 to $1 million for entities expending between $1 million and $34 million in federal awards.
  • New cybersecurity requirements: Recipients of federal awards must now implement reasonable cybersecurity measures as a part of their internal controls to safeguard sensitive information.
  • Increased de minimis indirect cost rate: The de minimis rate for indirect costs has been raised from 10% to 15% of modified total direct costs (MTDC).
  • Revised terminology: The term “non-federal entity” has been replaced with the term “recipient” or “subrecipient.”
  • Increased subaward threshold: The exclusion threshold of subawards has been raised from $25,000 to $50,000 for modified total direct costs.
  • Updated definition of equipment: The capitalization threshold for equipment has been raised from $5,000 to $10,000.
  • “Questioned costs” clarification: The definition of “questioned costs” has been revised, with examples added to provide further clarification.
  • Explanation required for questioned costs: When there are questioned costs, but the dollar amount is undetermined or not reported, the audit finding must include an explanation describing why the dollar amount is undetermined or not reported.
  • Clarified definition of “period of performance”: The definition of “period of performance” has been updated to mean the interval of time between the start and end date of a federal award, which may span multiple budget periods.

What’s Next?

School districts should review and update their internal controls to ensure compliance with the revised Uniform Guidance. For additional assistance in preparing your district for audits and for all of your other accounting needs, please don’t hesitate to reach out to our education accounting team at RBT CPAs. We’re here to ensure your school district stays in compliance with all applicable federal and state requirements and accounting standards. Give us a call today and find out how we can be Remarkably Better Together.

Attracting and Retaining Quality Staff in 2026: Challenges and Opportunities

Attracting and Retaining Quality Staff in 2026: Challenges and Opportunities

The hospitality industry is growing, and so is demand for workers, but persistent staffing shortages are making it increasingly difficult to meet that demand. High turnover rates lead to skills gaps, employee burnout, reduced productivity, and lost revenue. These factors can negatively impact the customer experience and your bottom line. The National Restaurant Association predicts in its 2030 Restaurant Industry report that recruitment, retention, and training will remain top priorities for the industry through 2030. Let’s talk about some ways hospitality employers can improve their retention strategies, starting off with a list of some of the most significant obstacles to hiring and retention currently facing the industry.

Challenges to Hiring and Retention in 2026:

  • Demanding nature of hospitality work
  • Generational shifts
  • Lack of training and support
  • Seasonal fluctuations
  • Lack of career advancement
  • Relatively low compensation
  • Limited benefits

How Can You Address These Challenges?

  1. Identify causes of low retention: Understanding why employees leave is critical to improving retention. Conduct regular check-ins with staff to identify issues, concerns, or potential growth areas. This practice not only demonstrates to your employees that you care about their happiness and job satisfaction, but also allows you to proactively make adjustments to create a better employee experience. When employees do leave, be sure to conduct exit interviews to determine their reason(s) for leaving, using this information to improve your policies and management practices moving forward.
  2. Update your recruiting strategies: Offering competitive pay and benefits is, of course, an effective strategy for attracting qualified talent. Even if you can’t afford to provide full health benefits for employees, offering other perks such as paid time off, employee discounts, retirement plans, tuition reimbursement, and wellness benefits can help make your business attractive to prospective candidates. Other factors that can boost your recruitment efforts include offering flexible work arrangements when possible, providing referral bonuses and regular pay raises, and leveraging social media as a recruiting tool to appeal to younger generations.
  3. Adapt to generational shifts: Gen Z employees are more selective when choosing jobs, particularly valuing flexibility and positive work environments. This new generation of workers is seeking roles that match their values and contribute to their long-term career goals. Appealing to this population involves promoting a positive workplace culture, embracing flexible scheduling when you can, and offering opportunities for career advancement.
  4. Provide opportunities for growth: Reframing hospitality roles as long-term career opportunities rather than temporary positions can significantly improve retention rates. Employers should establish clear pathways for advancement, outlining how employees can grow within the organization over time. Providing ongoing training and development is key. Remember to keep training interactive, engaging, and meaningful. By investing in employee growth, businesses can motivate staff to stay and build their future within the organization.
  5. Embrace technology: Automating routine tasks and processes through AI can reduce employee workload, helping to prevent burnout and allowing team members to focus more on delivering high-quality guest experiences. AI-powered tools can also help managers create staff schedules and forecast future staffing needs to avoid understaffing.
  6. Practice transparency: Clear communication during the hiring process is essential to setting expectations and building trust. Employers should be transparent about job responsibilities and expectations at the time of hiring, preventing employees from being blindsided by unexpected duties or requirements later on.
  7. Build relationships: Taking the time to understand your employees’ personal needs and professional goals lets them know you are invested in their growth and success. Additionally, by recognizing your team members’ hard work and accomplishments, you foster a positive and supportive workplace culture.

Partner with RBT

When you partner with RBT CPAs’ hospitality and restaurants accounting team, you gain the peace of mind that your business’s accounting needs are taken care of, so that you can focus on other priorities like your hiring and retention strategy. Give us a call today and find out how we can be Remarkably Better Together.

Behind on Filing Your AFRs? This OSC Webinar May Help

Behind on Filing Your AFRs? This OSC Webinar May Help

Annual Financial Reports (AFRs) are essential for maintaining transparency, accountability, and financial health in local governments. Municipalities are legally required to file their AFRs with the State Comptroller’s Office within 60-120 days after the close of the fiscal year. And yet, a growing number of local governments are failing to file these crucial reports on time—or at all. Late or missing reports leave taxpayers and other stakeholders without a clear picture of the municipality’s financial position and how public funds are being managed. Each year an entity fails to file an AFR, the task of catching up grows larger and more daunting. To compound the issue, when attempting to catch up on delinquent reports, local government employees often face the challenge of limited formal accounting records.

For this reason, the Office of the New York State Comptroller released a webinar last month aimed at assisting local governments in completing their delinquent Annual Financial Reports. The webinar focuses on helping local government employees understand the financial data needed to complete their Annual Financial Reports and where to find this data when formal accounting records are unavailable or limited. Here’s a broad overview of the key points covered in this webinar:

Questions addressed in this webinar:

  • How do you complete your AFR when accounting records are missing?
  • What source documents can you use to complete AFRs in the absence of formal accounting records?

Completing Delinquent AFRs: Webinar Key Points

  • Consequences of not filing your AFR include reduced transparency and confidence in management, potential impacts on credit rating, exclusion from the OSC fiscal stress monitoring system, and reduced ability to assess financial condition and manage fiscal emergencies.
  • Reasons for delinquent reports: the CFO did not meet fiscal responsibilities or was unaware of filing requirement, the municipality’s contact information is not up to date in OSC’s system, lack of board oversight.
  • Source documents that can be used to complete AFRs include bank statements, reconciliations, debt records, claims abstracts, payroll and benefits reports, tax warrants, user accounts (sewer/water/electric), and board meeting minutes.
  • Steps to follow when you need to complete a delinquent AFR with limited to no accounting records:
    1. Identify the significant events that occurred within that fiscal year.
    2. Compile the given financial data (i.e., bank statements, bank reconciliations, debt records, tax levies, etc.).
    3. Reconcile the beginning-of-year fund balance.
    4. Calculate the end-of-year fund balance (refer to the webinar for details on how to calculate this).
    5. Define revenues and expenditures.
    6. Review OSC’s AFR resources (e.g., training videos) and fill in AFR data.

Additional Resources

The webinar itself goes into much further detail regarding each step of this process, including examples and explanations. Other OSC resources that may be helpful include the following:

Achieve Financial Health with RBT CPAs

RBT CPAs is committed to helping local governments address the unique challenges they face, including staying on top of their day-to-day accounting and preparing Annual Financial Reports. Our specialized government accounting team is here to support all of your municipality’s accounting, tax, audit, and advisory needs, so that you can focus on meeting the needs of your community.  Give RBT a call today and find out how we can be Remarkably Better Together.

CAP Audits—What Are They and How Can You Prepare?

CAP Audits—What Are They and How Can You Prepare?

A CAP audit (CAP standing for “Compliance Audit Program”) is an investigation conducted by the U.S. Department of Labor’s Office of Labor-Management Standards (OLMS). CAP audits are specially designed for unions covered by the Labor-Management Reporting and Disclosure Act (LMRDA) and the Civil Service Reform Act (CSRA). The purpose of these audits is to verify union compliance with these laws, investigate potential violations, and provide compliance assistance. CAP audits are broader in scope than audits conducted by independent auditors and require extensive preparation. Let’s talk about what is involved in a CAP audit and what you can do to ensure your union is prepared.

How is a union selected for a CAP audit?

Your union may be selected for a CAP audit for several reasons. A small number of unions are selected at random each year for CAP audits. Otherwise, factors considered by OLMS when selecting a union to audit include:

  • Union size
  • Geographic location
  • Length of time since last audit
  • Availability of investigators
  • Failure to file required annual financial reports in a timely manner
  • Discrepancies in financial reports
  • Complaints received by OLMS regarding the union’s finances

What does a CAP audit entail?

A CAP audit begins with an interview of the primary financial officer, during which the investigator gathers detailed information regarding the union’s financial records, bookkeeping, and internal controls. The OLMS investigator may also request the presence of other employees involved in maintaining union financial records, such as bookkeepers or accountants. Union presidents are also often present for these interviews. During a CAP audit, the OLMS investigator reviews various financial records. Investigators may request any information from the union’s financial disclosure reports from the previous five years. Financial records typically reviewed during a CAP audit include, but are not limited to, original records (not copies) of the following:

  • Bank account records: bank statements, duplicate deposit checks, debit/credit memos, and bank reconciliations
  • Records for investments and all other assets, including inventories of fixed assets
  • Receipts records: duplicate receipts, receipt journals, member ledger cards
  • Disbursement records: canceled checks, check stubs, disbursement journals, payroll ledgers, vouchers, expense receipts, bills, credit card statements, and other supporting documents
  • Audit reports prepared by union auditors or external accountants
  • Minutes from executive board meetings and membership meetings
  • Current constitution and bylaws
  • Financial policy documents

Audit findings and recommendations will be shared with key union officials upon completion of the audit in the form of an exit interview and a closing letter. The investigator will offer compliance and technical guidance related to LMRDA and CSRA requirements. At this stage of the process, union officials have the opportunity to ask questions and contribute comments. The closing letter will then be made accessible to union members on the OLMS website.

How can you prepare for a CAP audit?

  • Ensure your union’s financial records for the last five years are complete and accurate
  • Review your union’s policies for compliance with LMRDA and CSRA requirements
  • Ensure accurate and timely LM-2 reporting
  • Review and strengthen your union’s system of internal controls

 Have Confidence in Your Union’s Compliance

When you partner with RBT CPAs, you can be confident in your union’s compliance with financial reporting and recordkeeping regulations. Beyond assistance with DOL audits, RBT CPAs’ union accounting team provides a full range of accounting, bookkeeping, and CFO services. Our union-specialized services include internal control reviews, financial statement preparation, forensic audits, LM-2 preparation, and more. Call RBT CPAs today for all of your union’s accounting needs and find out how we can be Remarkably Better Together.