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3.19 Audit Requirements

Commercial (For-Profit) Organizations

These organizations must have financial and compliance audits conducted by qualified individuals who are organizationally, personally, and externally independent from those who authorize the expenditure of Federal funds.

  • This audit must be performed in accordance with the Government Auditing Standards (January 2007 Revision) [PDF - 867 Kb], as found on the GAO website.
  • The purpose of this audit is to ascertain the effectiveness of the financial management systems and internal procedures that have been established to meet the terms and conditions of the award.
  • Usually, these audits must be conducted annually. They must be conducted no less frequently than every 2 years. The dollar threshold that is established for audit reports in 2 C.F.R. ?? 200.500 applies, as amended.