2025 OMB Compliance Supplement: What Is It and Key Single Audit Updates

Recently, the Office of Management and Budget (OMB) experienced delays in issuing its OMB Compliance Supplement (Supplement), which in turn postponed the issuance of Single Audits for fiscal years ending on or after June 30, 2025. On November 25, 2025, the OMB Compliance Supplement 2025 was finally issued. However, its release left many auditees wondering: what actually is the Supplement, and what key updates do I need to be aware of for 2025?

What Is the OMB Compliance Supplement?

The Supplement is issued annually, and auditors are required to use it when performing Single Audits. The Supplement provides auditors everything from suggested audit procedures to audit-specific guidance for particular federal programs. In other words, understanding how to navigate the Supplement helps auditees know what to expect in their upcoming Single Audit.

The following sections provide a comprehensive overview of the Supplement and highlight the most significant updates for 2025. These essential insights will allow you to navigate the latest requirements and changes with confidence.

Part One: Who Needs the 2025 OMB Supplement?

The Supplement comprises eight parts, and Part One describes the background, purpose, and applicability of the Supplement. It is well worth reading if this is your first experience with the Supplement.

Part Two: Details Major Changes

Part Two of the Supplement provides the matrix of compliance requirements for programs identified by their Assistance Listing (AL). Each year, federal agencies submit a matrix detailing up to six of the twelve compliance requirements that will be Subject to Audit. In practice, this means that even if a grant must follow Allowable Cost principles, if Part 2 shows an “N” in the Allowable Cost column for that program, the Single Audit will not test Allowable Costs. However, auditees should note that even if a compliance requirement is not identified as being “Subject to Audit” for a particular federal program, you are still required to comply if the compliance requirement is applicable to your federal award.

The 12 compliance requirements consist of:

Federal agencies submit this information only for ALs with a high level of federal assistance issued by the agency, but it does not include all ALs. Each year, ALs are added, updated, and removed from this matrix. Yellow highlights in the 2025 Supplement’s Part Two represent changes from the 2024 Supplement.

Part Three: Uniform Guidance Revisions

Part Three addresses the 12 previously mentioned compliance requirements and offers the most detailed overview of the testing an auditor will conduct during a Single Audit. For each of the 12 points of compliance summarized above, Part Three provides an overview of the compliance requirement audit objectives and, most importantly, suggested audit procedures.

The main update in Part Three is the split of suggested audit procedures into two sets: one for federal grants under the existing Uniform Guidance [Part 3.1] and another for those subject to the 2024 Uniform Guidance Revisions [Part 3.2]. As a result, auditors will ask auditees to identify which version of the Uniform Guidance applies to each major program agreement, so they can use the correct section of Part Three. As mentioned, the determination of which version of the Uniform Guidance applies is made on an award-by-award basis.

For more details on the 2024 Uniform Guidance Revisions, the Council on Federal Financial Assistance has published a document covering Key Revisions, implementation guidance, and other resources, and it including implementation guides to determine the correct version of the Uniform Guidance. This document is located on the 2024 Revisions & Resources web page.

Part Four: Single Audit Guidance and Updates

Part Four outlines the specific program requirements provided by federal agencies for ALs included in the Supplement. Agencies may include key guidance in this area for auditors when testing related programs. This section is updated regularly in the OMB Compliance Supplement to reflect any changes in federal programs. When applicable to your federal program(s), Part Four outlines the key requirements communicated to your auditor and identifies which compliance requirements are Subject to Audit.

In the 2025 Supplement, several Department of Housing and Urban Development programs were revised, including the Supportive Housing Programs. Additional updates were made to federal programs throughout Part 4, further refining the guidance communicated to auditors by federal agencies.

Part Five: Student Financial Aid, Research & Development, and Other Program Clusters

Part Five covers the same areas as Part Four, but instead of individual programs, it focuses on the clusters included in the Compliance Supplement, particularly the Research and Development and Student Financial Aid clusters. The final section of Part Five formally identifies these clusters, which is essential for preparing the Schedule of Expenditures of Federal Awards and ensuring that, when applicable, federal programs are reported and subtotaled by cluster.

Part Six: Internal Controls for Federal Awards

Part Six is intended as a resource providing internal control guidance for federal awards. Organizations receiving federal assistance must maintain a system of internal controls that provides reasonable assurance of compliance with federal requirements. Under Single Audits, the auditor must gain an understanding of these controls and audit the controls.

Part Six provides an overview of an auditee’s responsibility for establishing and maintaining internal controls over federal awards. It includes controls under the Standards for Internal Control in the Federal Government, which is issued by the Government Accountability Office. It also includes the Internal Control Integrated Framework – COSO Framework, issued by the Committee of Sponsoring Organization of the Treadway Commission. Under 2 CFR Part 200, the Green Book and the COSO Framework are recommended internal controls structures, but they are not required. Part Six provides examples of controls using these structures. In previous compliance supplements, this part had been removed as OMB worked to incorporate changes in the Green Book and COSO Framework.

Although entities are not required to implement the example control activities outlined in Part Six, the guidance can be extremely helpful, especially for organizations new to establishing internal controls for federal awards. It also serves as a valuable resource for any grant management system looking for examples to strengthen existing controls.

Part Seven: Auditing Programs Not Included in the Supplement

Part Seven details when an AL is not included in the Compliance Supplement and how the program should be audited. Of all parts in the Compliance Supplement, Part Seven contains the most technical audit jargon; therefore, it may not be as helpful for auditees compared to other parts.

Part Eight: Resources, Summary of Changes, and Single Audit Advisories

Part Eight includes the appendices to the Supplement. They include:

• Federal Programs Excluded from the A-102 Common Rule and Portions of 2 CFR Part 200 (Appendix I)
• Federal Agency Codification of Government-wide Requirements and Guidance for Grants and Cooperative Agreements (Appendix II)
• Federal Agency Single Audit, Key Management Liaison, and Program Contacts (Appendix III)
• Internal Reference Tables (Appendix IV)
• List of Changes for the 2025 Compliance Supplement (Appendix V)
• Other Audit Advisories (Appendix VII)

Appendix IV identifies programs considered higher risk by federal agencies and the OMB. Auditors use this information to determine which federal awards should be considered major programs and, therefore, audited. In the 2025 Supplement, the list of higher-risk federal programs was significantly reduced and now includes only the programs in the following table.

A summary of changes to all parts and appendices of the 2025 Supplement is provided in Appendix V, while Appendix VII includes Single Audit advisories for auditors. In addition, Appendix VII emphasizes the implementation of the 2024 Uniform Guidance revisions similar to the new write-up in Part Three.

These two sections, Appendices V and VII, are always the starting point when a new OMB Compliance Supplement is released.

Clark Nuber Audit Support

The OMB Compliance Supplement is an invaluable resource for auditees, once you know where to look and what to focus on. In an era of significant changes to federal funding, it is important for auditees to be aware of available resources. Happy navigating!

If you require help when preparing for a Single Audit, managing your federal grant, or just have federal grant compliance questions, contact a Clark Nuber professional.

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