Financial Reporting Requirements
To make sure that grant funds are used properly, organizations that receive Federal funds must file regular financial status reports. These forms should not take long to complete, but they are important. The basic financial report form is a one-page document called Standard Form 269. Many agencies have adapted this form to suit their own programs. You can find a copy of Standard Form 269 at https://obamawhitehouse.archives.gov/omb/grants/sf269.pdf .
All agencies/organizations that receive Federal funds are subject to basic audit requirements, including community and faith-based groups. These audits are intended only to examine the Federally-funded parts of an organization's operations and are not designed to identify unrelated problems. The audits are necessary to make sure that Federal dollars have been spent properly on legitimate costs. It is therefore extremely important for grant recipients to keep accurate records of all transactions conducted with Federal funds.
Most organizations are not audited by the government itself, although the Federal government has the right to audit any program that receives public money at any time. For example, organizations that spend less than $300,000 a year in Federal funds are generally asked only to perform a "self-audit." For larger grants -- those over $300,000 a year -- an audit by a private, independent outside legal or accounting firm is required. More information on audits may be found on the Office of Management and Budget's website (www.whitehouse.gov/omb/circulars).