Industries: Nonprofit

The Office of Management and Budget (OMB) has released their proposed changes to the Uniform Guidance requirements. Nonfederal entities can comment on the proposed changes through March 23, 2020 at

Among the proposed changes are –

Procurement Revisions

The proposed guidance removes specific threshold dollar amounts from the Uniform Guidance and aligns it with the Federal Acquisition Regulation (FAR), the 2017 and 2018 National Defense Acquisition Authorization Acts (NDAA), and the OMB Memorandum M-18-18. If these changes are accepted, the micro-purchase threshold would increase to $10,000 (from $3,500) and the simplified acquisition threshold would increase to $250,000 (from $150,000) for all nonfederal entities. The definition of micro-purchase also includes the purchase of supplies or services for which the aggregate amount does not exceed the micro-purchase threshold.

Governmentwide Approach to Performance and Risk

This section focuses on the Results-Orientated Accountability for Grants Cross-Agency Priority Goal (Grants CAP goal) that shifts the balance between compliance and performance while reducing burden. It encourages Federal agencies to work together to develop a risk-based approach that incorporates performance to achieve results-oriented grants. It continues to apply less restrictive conditions to ensure that the award conditions are consistent with the program design and include clear performance expectations of recipients. This includes clear performance goals, indicators, and milestones. The proposed guidance encourages the measurement of recipients’ performance to improve program goals and objectives, share lessons learned, and spread the adoption of promising practices. The last part of the proposed changes is an encouragement and clarification that evaluation costs are allowable as either direct costs or indirect costs under a Federal award.

De Minimus Indirect Cost Rate

The proposed guidance revises the current 10% de minimus indirect cost rate that is only used by nonfederal entities that have never received a negotiated rate to allow all nonfederal entities to use the 10% de minimus indirect cost rate, except for State and Local Government and Indian Tribe Costs. The proposal clarifies that no documentation is required to provide proof of costs that are covered under the de minimus indirect cost rate.

Responsibilities of the Pass-Through Entity (PTE)

The proposal clarifies that a PTE is only required to address a subrecipient’s audit findings that are specifically related to their subaward. They are not required to address all of the subreceipient’s audit findings. In addition, a PTE may rely on the subrecipient’s auditors and cognizant agency’s oversight for routine audit follow-up and management decisions. ​

Other changes in the proposed guidance are related to notices of funding opportunities, the Audit Quality Project, the applicability of the standard, and updates for definitions and terminology to be in alignment with statutory and other requirements.

These and other proposed changes can be reviewed as a PDF, 3-column format.

BPM for Nonprofit

The Nonprofit Industry Group is one of BPM’s most established practice groups, and it consists of over 60 professionals who provide a comprehensive understanding of the functions needed to operate a nonprofit organization. For more information or to find out about an upcoming event, contact your BPM advisor, call (415) 421-5757, or email [email protected].

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