Certified Research Administrator Practice Exam

OMB Circular A-133 applies to contracts and grants issued to which types of organizations?

1. Only States

2. Only Local Governments

3. All States, Local Governments, and Non-Profit Organizations

4. Only Non-Profit Organizations

The correct answer is: All States, Local Governments, and Non-Profit Organizations

OMB Circular A-133, which has been replaced by 2 CFR Part 200 (Uniform Guidance), establishes the requirements for audits of organizations that receive federal funds. This includes a wide range of entities such as States, Local Governments, and Non-Profit Organizations. The circular is designed to ensure that these organizations are held accountable for federal expenditures and that they use federal funds appropriately. It sets forth guidelines for financial management, compliance, and performance measurement. The inclusion of all these types of organizations under OMB Circular A-133 reflects the government's commitment to ensuring transparency and accountability in the use of public funds. By applying to States and Local Governments along with Non-Profit Organizations, the circular ensures that different entities which may be recipients of federal funding adhere to the same rigorous standards of financial reporting and accountability, promoting consistent practices across various sectors that benefit from federal grants and contracts.