Multifamily Housing Program Financial Management Toolkit

Knowledge Check – Audits

Select the appropriate response to complete the statement and then, select the Submit button.

1. Which type of review applies to an organization that has expended $750,000 or more of Federal funds in a single accounting year?

A. Reviewed Financials
B. Single Audit
C. Compiled Financials
D. Program Audit
E. B and D

2. The Federal Audit Clearinghouse is the entity that conducts audits for organizations.


3. Audits can benefit your agency by doing all of the following EXCEPT:

A. Verifying that you are complying with laws, regulations, and agreements.
B. Providing additional Federal funding if no findings are reported.
C. Providing information on whether financial records are reliable.
D. Assessing whether there is proper accounting and disbursing of funds.
The correct answer is ‘B.’ The purpose of an independent audit is, first, to affirm that the systems and records maintained by the auditee are in compliance with GAAP and all additional requirements for Federal grantees laid out in 2 CFR 200 and then to publish those financial records in a standardized format that is easily understood.

4. According to 2 CFR 200 (and 24 CFR Part 85 and 84), grantees and sub-recipients must hire an independent auditor who:

A. Has a special government-issued license for conducting single audits of HUD programs as a means of in protecting participants’ confidentiality
B. Has past experience working with HUD programs, per the requirements outlined in the Government Auditing Standards.
C. Has experience conducting audits dealing with funds in excess of $750,000.
D. Is a certified public accountant (CPA) with a current license issued by the State in which the CPA practices.

5. An FY 2014 grantee wants to refer back to the Federal regulations governing compliance requirements and suggested audit procedures specific to its program. This grantee should reference the:

A. Generally Accepted Auditing Standards (GAAS).
B. Accounting Standards and Processes (ASP).
C. 2 CFR 200 – Subpart F – Audit Requirements
D. OMB Circular A-133 Compliance Supplement.