In 2025 the OMB Compliance Supplement, the guide auditors rely on to test federal grants, did not appear until late November. Many Single Audits stalled while they waited. That delay hangs over one of the changes in the Office of Management and Budget’s proposed rewrite of the Uniform Guidance, issued on May 29, 2026.
The proposal revises 2 CFR part 200, the Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. It reaches many parts of grants management, but for not-for-profits and other recipients the section to watch is Subpart F, the audit rules. Subpart F governs how Single Audits are done, how agencies use the results and how extra oversight can happen. The proposed changes fall in three areas: when extra audits may be imposed, how often the Compliance Supplement appears, and which internal control frameworks are named. Read together, they suggest OMB wants to cut needless audit burden without weakening oversight of award compliance or Single Audit quality.
Extra audits would need a statute
Section 200.503 now says a Single Audit should generally stand “in lieu of” other financial audits of federal awards required by statute or regulation. It also lets a federal agency, an Inspector General or the GAO conduct or arrange additional audits, so long as they avoid duplication and build on work already done.
OMB proposes that those bodies could impose additional audits only when a statute authorizes them. Put simply, a regulation alone could no longer layer on audit requirements.
Oversight would not vanish. OMB says agencies could still run compliance reviews to carry out other parts of part 200, for example to check whether a recipient or subrecipient meets substantive programmatic or legal requirements such as civil rights laws or conscience protection laws. For nonprofits, the upshot is less duplicated auditing, with accountability intact.
A Compliance Supplement that may not be annual
The Compliance Supplement sits at the center of Single Audit planning. It lists important compliance requirements, suggests audit procedures for the 12 points of compliance and gives testing guidance for certain federal programs. Section 200.513(c)(4) now requires agencies to send OMB annual updates, and section 200.1 describes the supplement as an “annually updated authoritative source.”
OMB would strike “annual” from the first and “annually updated” from the second, because it is reconsidering how often the supplement should come out. It said it is evaluating the Single Audit process more broadly, so more Subpart F changes could follow. The supplement has traditionally come out in spring or early summer.
A slower cycle cuts both ways. If requirements hold steady from year to year, audits could become more stable. If not, auditors and recipients would have to track changes in program statutes, regulations, award terms, agency guidance and Federal Register notices between editions. That could add administrative work for both sides. Section 200.514 already says that when requirements change and the supplement does not reflect it, the auditor must decide how to respond.
Control frameworks
The third change takes out references to the GAO Green Book and the COSO framework. Section 200.514(c)(1) currently says the supplement’s internal control guidance rests on the GAO’s “Standards for Internal Control in the Federal Government” and COSO’s “Internal Control Integrated Framework.” Section 200.303 says recipients’ controls should align with those frameworks, though in the Uniform Guidance “should” is a best practice, not a rule.
OMB’s reasoning, laid out in its discussion of section 200.303, is that GAO is a legislative branch agency and COSO a private body, and that pointing recipients to shifting standards from outside the executive branch conflicts with administration policy and OMB’s notice-and-comment process for 2 CFR. The change would make clear that neither framework applies to recipients as a binding or expressly recommended standard. Agencies, auditors and recipients could still use them, or other well-known frameworks, as general reference points.
The duty to maintain effective internal control over federal awards would stay. So would the auditor’s job of testing controls over compliance for major programs under section 200.514. What changes is discretion in how controls are set up and documented.
A wider review of audit quality
The proposal says OMB and the Office of Inspector General at the Department of Health and Human Services were chosen to analyze the Single Audit process. The Financial Management Risk Reduction Act, Public Law 118-207, backs that up. It directs the OMB Director to designate agencies for a government-wide analysis of Single Audit quality within three years of enactment and every six years afterward, and requires a public summary of the results sent to congressional committees. HHS OIG is carrying out the review. The Act also calls for tools and a strategy that use Federal Audit Clearinghouse data to spot risks to federal award money across government, and for the GAO to evaluate them.
The comment process on the proposed rule is the next step.
