Behavioral health grantees that draw federal dollars face a recurring compliance hurdle: the single audit. Substance Abuse and Mental Health Services Administration (SAMHSA) recipients that expend significant federal funds must clear this examination every year, and the same handful of deficiencies show up again and again in the Federal Audit Clearinghouse. This article breaks down the most-cited single audit findings for SAMHSA-funded organizations between 2024 and 2026 and gives you a practical path to avoid them.
Quick answer: A single audit is required when an organization expends $1,000,000 or more in federal awards in a fiscal year, per 2 CFR 200.501. For SAMHSA behavioral health grantees, the most frequently cited findings cluster around reporting (late or inaccurate Federal Financial Reports, FFATA subaward filings, and the Schedule of Expenditures of Federal Awards), procurement, subrecipient monitoring, allowable costs and payroll allocation, and documentation. Most of these stem from weak internal controls rather than misuse of funds, and they are preventable with disciplined processes.
What Triggers a Single Audit for SAMHSA Grantees
When your organization accepts a SAMHSA award, you agree to comply with the federal grants framework governing financial management, internal control, allowable costs, and audit. The audit obligation itself comes from the Uniform Guidance at 2 CFR Part 200, Subpart F. The trigger is expenditure, not receipt: an entity that expends $1,000,000 or more in federal awards during its fiscal year must obtain a single audit or a program-specific audit for that year.
The distinction between expending and receiving funds is more than semantics. An organization can hold a multi-year award yet stay below the threshold in a given fiscal year if its actual outlays are modest, and it can exceed the threshold in a year of heavy spending even though no new award arrived. This is why federal expenditures must be tracked continuously rather than estimated once at year-end.
The threshold matters because it recently changed. The 2024 revision to the Uniform Guidance raised the single audit threshold from $750,000 to $1,000,000, applicable to fiscal years beginning on or after October 1, 2024. Behavioral health providers that hover near the line should track federal expenditures across all programs, including federal funds that flow through a state agency, because those pass-through dollars count toward the threshold even when the check comes from the state.
That pass-through point trips up more grantees than any single rule. A provider may think of itself as a state-funded program and overlook that the state is merely routing federal block grant dollars, which retain their federal character all the way down to the provider. Misclassifying those funds as state money can understate total federal expenditures and lead an organization to skip an audit it was legally required to obtain.
There is another structural change SAMHSA grantees need on their radar. Effective October 1, 2025, the U.S. Department of Health and Human Services phased out its own audit regulation at 45 CFR Part 75 and adopted 2 CFR Part 200, with certain HHS-specific provisions relocated to 2 CFR Part 300. Practically, this aligns SAMHSA grantees with the government-wide Uniform Guidance, so your auditor will test compliance against 2 CFR 200 for periods on or after that date. Organizations that work with a CPA team experienced in behavioral health engagements tend to absorb these transitions with far less disruption.
The Most-Cited Single Audit Findings for Behavioral Health Grantees
Single audit findings reported to the Federal Audit Clearinghouse are sorted into standardized compliance-requirement categories. For SAMHSA programs, including the large Projects of Regional and National Significance grants, the same categories dominate year after year. The findings below reflect the patterns CPAs see most often in 2024 through 2026 behavioral health audits.
Reporting
Reporting is consistently the single most-cited category for SAMHSA grantees. The failures take several forms: late Federal Financial Reports (the SF-425), inaccurate or unreconciled figures between the general ledger and what was reported to the funder, missed Federal Funding Accountability and Transparency Act (FFATA) subaward reports, and errors in the Schedule of Expenditures of Federal Awards (SEFA). Because federal funders set firm deadlines for periodic financial and performance reports, a missed filing is enough to generate a finding even when the underlying spending was proper.
The SEFA deserves special attention. It is the foundation of the entire single audit, and auditors use it to determine which programs are major and therefore subject to deeper testing. A common behavioral health error is omitting federal funds passed through a state behavioral health authority, which produces an incomplete SEFA and often rises to a material weakness. Reconcile the SEFA to your accounting records and to each award letter before the audit begins, not during fieldwork.
An accurate SEFA also protects you on the back end of the engagement. When the schedule is wrong, the major-program determination built on top of it is wrong too, which can mean an auditor tests the wrong programs and a funder later questions the scope. Treating the SEFA as a controlled deliverable, prepared and reviewed by a named person, removes a surprising amount of audit risk.
Procurement and Suspension and Debarment
The Uniform Guidance requires grantees to maintain written procurement standards and to follow them consistently. Findings arise when an organization buys goods or services above its own documented threshold without evidence of competition, or cannot show the basis for selecting a vendor. Sole-source justifications that are missing or written after the fact are a frequent trigger.
Closely related is the suspension and debarment requirement. Before entering a covered transaction, grantees must verify that vendors and subrecipients are not excluded parties, typically by checking SAM.gov and retaining the documentation. Auditors routinely cite organizations that paid covered contractors without any record that the exclusion check occurred.
The fix here is procedural rather than financial. A short procurement checklist that records the competition method, the selection rationale, and the date of the exclusion verification turns an unwritten habit into reviewable evidence. The work was often done correctly; the finding usually reflects that no one captured proof of it.
Subrecipient Monitoring
Behavioral health grantees frequently pass funds to community partners, and that arrangement carries its own compliance weight. The Uniform Guidance requires a pass-through entity to make required risk assessments, include specific information in subaward agreements, and monitor subrecipient activities to ensure federal funds are used for authorized purposes. Findings appear when there is no documented risk assessment, no ongoing monitoring, or no follow-up on subrecipient single audit results.
This is one of the more resource-intensive requirements to satisfy, and it is a common gap for organizations that grew their subaward portfolio faster than their back-office controls. Building a standard monitoring file for each subrecipient, with the agreement, risk rating, monitoring activities, and audit-result review, closes most of these findings. Nonprofits managing multiple federal streams often lean on outside specialists for this work; our nonprofit accounting and assurance team helps grantees stand up monitoring processes that hold up under examination.
Monitoring is also where a pass-through entity inherits risk it did not create. If a subrecipient misuses federal funds, the pass-through entity can be held accountable for failing to catch it, which is why the regulation frames monitoring as an active obligation rather than a courtesy. Scaling the intensity of monitoring to each subrecipient’s risk rating keeps the effort proportionate and defensible.
Allowable Costs and Cost Principles
The cost principles in 2 CFR Part 200 Subpart E govern what can be charged to a federal award and on what basis. Common findings include charging costs that are not allocable to the program, missing or inadequate approvals, indirect costs applied at a rate other than the negotiated or de minimis rate, and expenditures that lack supporting documentation. Behavioral health organizations with blended funding are especially exposed because costs serving multiple programs must be allocated on a reasonable, documented basis.
The allocation question is where good intentions meet audit reality. A cost that genuinely benefits a federal program is still a finding if the method for assigning it cannot be explained and reproduced. Writing down the allocation basis, and applying it the same way each period, is what converts a reasonable judgment into an allowable charge.
Payroll and Time and Effort
Personnel costs are usually the largest line in a behavioral health budget, which makes payroll allocation a high-stakes area. The Uniform Guidance does not mandate a particular timekeeping form, but it does require that charges to federal awards be based on records that accurately reflect the work performed. Findings result when salaries are allocated by budget estimate without periodic reconciliation to actual effort, or when time records are not certified by someone with firsthand knowledge of the work.
Because payroll touches nearly every award, a weakness here tends to spread across multiple programs at once, magnifying a single control gap into a pervasive finding. Reconciling budgeted effort to actual effort on a regular cycle, and having the right person certify it, keeps the largest cost category on solid ground.
Internal Control and Documentation
Many findings ultimately trace back to documentation and control gaps rather than a substantive compliance failure. If an auditor cannot reconstruct a test, for example confirming participant eligibility or recomputing an allocation, from the files you provide, the result is a finding regardless of whether the activity was correct. Maintaining organized, retrievable records for the full retention period is one of the highest-return investments a grantee can make.
How SAMHSA Grantees Can Avoid These Findings
Prevention starts well before fieldwork. Reconcile the SEFA to the general ledger and to each award document early, confirm every federal report was filed on time and ties to your books, and assemble a complete file for each subrecipient. Run a quick internal walkthrough of procurement and suspension-and-debarment documentation on a sample of transactions so gaps surface on your timeline rather than the auditor’s.
Equally important is the calendar. Under 2 CFR 200.512, the audit reporting package must be submitted to the Federal Audit Clearinghouse the earlier of 30 calendar days after you receive the auditor’s report or nine months after the end of the audit period. A late submission is itself reportable and can affect your standing for future awards, so build the audit timeline backward from that deadline.
Working backward from the deadline also exposes the real bottleneck, which is rarely the audit fieldwork itself. It is the closing of the books, the reconciliation of the SEFA, and the collection of subrecipient documentation that consume the calendar, so those tasks deserve owners and target dates of their own.
Finally, treat each prior-year finding as a corrective-action commitment, not a one-time fix. Auditors specifically test whether prior findings were resolved, and repeat findings escalate in severity and draw funder scrutiny. Documenting the corrective action, assigning an owner, and verifying it the following year is what separates organizations that clear the audit cleanly from those that cycle through the same deficiencies.
Frequently Asked Questions
When is a single audit required for a SAMHSA grantee?
A single audit is required when your organization expends $1,000,000 or more in federal awards during its fiscal year, under 2 CFR 200.501. The threshold counts all federal expenditures across programs, including federal funds received indirectly through a state pass-through agency. The $1,000,000 threshold applies to fiscal years beginning on or after October 1, 2024, up from the prior $750,000.
What is the most common single audit finding for behavioral health organizations?
Reporting is the most frequently cited category. This includes late or inaccurate Federal Financial Reports, missed FFATA subaward filings, and errors in the Schedule of Expenditures of Federal Awards. Most of these are control failures rather than misuse of funds, which means they are largely preventable with reconciliation and a tracked reporting calendar.
What is the deadline to submit the single audit to the Federal Audit Clearinghouse?
The reporting package is due the earlier of 30 calendar days after you receive the auditor’s report or nine months after the end of the audit period, per 2 CFR 200.512. If the due date lands on a weekend or federal holiday, it moves to the next business day. A cognizant or oversight agency may grant an extension only in limited hardship circumstances.
Did the audit rules for SAMHSA grants change recently?
Yes. Effective October 1, 2025, HHS phased out its 45 CFR Part 75 audit regulation and adopted the government-wide Uniform Guidance at 2 CFR Part 200, with certain HHS-specific provisions in 2 CFR Part 300. For audit periods on or after that date, SAMHSA grantees are tested against 2 CFR 200, which also reflects the 2024 revisions including the higher audit threshold.
