In 2020, an unprecedented number of government and nonprofit organizations have received federal funding in response to the COVID-19 pandemic, e.g., the Coronavirus Relief Fund established by the Coronavirus Aid, Relief, and Economic Security Act. As addressed in our previous article, many of these funds are subject to Single Audit, which requires recipients to prepare a Schedule of Expenditures of Federal Awards (SEFA). For many organizations, this may be their first time doing so. If your organization is a SEFA first-timer or you need a refresher on the basics, read on.

This article aims to answer some of the nagging questions you may have about the SEFA and explain how, when prepared properly, it can help your Single Audit go more smoothly.  

What is the SEFA? 

Simply put, the SEFA is a supplemental schedule to an organization’s financial statements recapping expenditures of federal awards during the organization’s fiscal year by federal agency and program. A more detailed definition is provided in the Uniform Guidance, CFR Section 200.510. 

Why is the SEFA important? 

The SEFA is a key reporting package component required by Uniform Guidance. It provides a picture of all federal awards for which an organization expended funds during its fiscal year. Auditors also use the SEFA to determine which programs listed are “major programs” or require testing in the compliance audit. While the auditee is responsible for the SEFA, organizations can enlist the help of an outside CPA firm to help prepare it. This can be especially valuable to organizations working with multiple federal awards or those that haven’t worked with federal awards in the past. Since the SEFA is used to determine which programs warrant testing, an inaccurate SEFA can lead to the wrong programs being tested or result in noncompliance with the Uniform Guidance.   

How do I prepare the SEFA?

There are some helpful resources available online. For example, the American Institute of CPAs Government Audit Quality Center provides Auditee Practice Aids for the SEFA, and many state websites offer instructions, checklists, and even templates for preparing the SEFA. Beyond these resources, here are a few steps to get you started:  

  • Start preparing early to allow for adequate review by all parties with knowledge of federal awards received and expended (a best practice is to reconcile the SEFA to the general ledger monthly, rather than waiting until year-end) 
  • Read the Uniform Guidance to become familiar with the required elements 
  • Gather the necessary information, such as: 
    • List of awards by federal agency and program 
    • The name of pass-through entities and an identifying award number with pass-through entities, if applicable
    • The amount of expenditures, period, and amount of each award
    • Any federal programs within a “cluster” established through the Compliance Supplement
    • Federal awards supporting research and development activities

What are the most common mistakes to avoid?

On the surface, the SEFA appears straightforward, but that doesn’t necessarily mean it’s not complicated. Within this schedule, there are many opportunities for error. Some common mistakes include:

  • Missing or incorrect Catalogue of Federal Domestic Assistance (CFDA) number (you can check the CFDA numbers against the federal website at, and you also can confirm with the grantor if there’s any uncertainty)
  • Failure to capture programs in a cluster 
  • Incorrectly reporting expenditure amounts
  • Improperly labeled research and development awards 
  • Misidentifying pass-through awards
  • Improperly reporting subrecipient expenditures (not capturing the correct period)

It’s important to note that all COVID-19 funding is required to be identified as such per the 2020 Compliance Supplement. Entities are required to add “COVID-19” prior to the program name (this includes COVID-19 funds that were provided under a non-COVID-19 CFDA number).

How can BKD help?

For years, BKD has used our expertise and insight in grant compliance to help organizations successfully expend or administer federal awards and prepare for Single Audits including SEFA preparation. We have the experience and real-time knowledge of federal awards to answer your questions and help guide you through the process. 

Reach out to your BKD Trusted Advisor™ or submit the Contact Us form below if you have questions.

Related FORsights

Let's Connect

Subscribe to our content or get in touch with us today

Subscribe Contact Us