Federal Awards Accountability

Each year, California receives billions of federal funds for numerous programs. As a condition of receiving these federal funds, the state must annually have an independent audit of California's financial statements as well as an independent audit of California's compliance with federal regulations for the programs the federal government provides funding for. The State Auditor plays a critical role in oversight for the federal funds received each year. State statutes mandate that the California State Auditor annually conduct—in accordance government and industry auditing standards—California's Single Audit, which is a combination of an audit of California's financial statement and the state's compliance with federal program requirements. Further, this comprehensive annual audit fulfills the provisions of the federal Single Audit Act of 1984 and the Single Audit Act Amendments of 1996.

From July 1, 2010 through June 30, 2011, California expended $83.6 billion in federal funds through 400 programs or program clusters—including $44.7 billion for health and human services programs and $21.7 billion for workforce and unemployment programs. Funds expended under the American Recovery and Reinvestment Act of 2009 (Recovery Act) accounted for $9.5 billion of the total $83.6 billion expended. We audited 35 major federal programs or program clusters totaling $78.7 billion, which represents 94 percent of the total amount California expended.

The Recovery Act, also known as the federal stimulus, accounts for a significant portion of current federal funding. One of the Recovery Act's three immediate goals is to foster unprecedented levels of accountability and transparency in government spending, and the State Auditor is an integral part of achieving that goal in California.