What Is the Schedule of Expenditures of Federal Awards (SEFA)?

The importance of SEFA cannot be overstated—it is the federal government’s lens into your organization’s grant management. Billions of dollars flow from Washington to nonprofits every year, and SEFA is the official record showing how that money was spent.

For nonprofits, SEFA carries weight in three distinct ways:

1. It drives the Single Audit.
A Single Audit doesn’t start with your ledger; it starts with SEFA. The auditor uses it to select which programs to test, how to design audit procedures, and where to look for risk. If SEFA is incomplete or inaccurate, the entire audit scope is flawed. That’s why errors in SEFA consistently rank among the most common Single Audit findings nationwide.

2. It signals organizational credibility.
Funders, regulators, and even private donors look to your audit reports for assurance that their money is being handled responsibly. A clean SEFA presentation shows discipline, transparency, and strong internal controls. A flawed SEFA, on the other hand, undermines confidence—suggesting that your systems may not be strong enough to manage large or complex awards.

3. It protects your future funding.
Federal agencies rely on audit results when deciding whether to continue awarding grants. If your SEFA is riddled with mistakes, findings may accumulate, and repeat findings can threaten eligibility for future funds. Even beyond the federal government, state pass-through entities and private funders may look at your history of compliance before awarding support.

In short: SEFA is not just about passing an audit—it is about protecting your organization’s reputation, funding, and long-term mission capacity.

The consequences of a flawed SEFA go far beyond an untidy report. They ripple across the audit, your funding, and your reputation.

If SEFA is inaccurate, the Single Audit itself may be delayed or result in expanded testing. This means more time, higher audit costs, and potentially strained relationships with auditors. Findings tied to SEFA errors can lead to corrective action plans that drain staff resources and distract leadership from mission work.

The funding risk is even greater. Repeated findings in SEFA can make a nonprofit appear high-risk to federal agencies, jeopardizing eligibility for future awards. In some cases, agencies may impose additional oversight, restrict drawdowns, or even suspend funding until compliance issues are resolved.

There is also the less tangible but equally damaging impact of eroded trust. Boards, donors, and community partners expect that federal money is handled with precision. If audit reports show deficiencies in something as fundamental as SEFA, it casts doubt on the organization’s ability to manage larger or more complex projects. In today’s funding environment, credibility is as valuable as cash flow—and SEFA is a litmus test for both.

For nonprofits managing multiple grants, SEFA complexity multiplies quickly. A single report might need to capture awards from HUD, HHS, and USDA, each with its own cost principles and reporting quirks. Add in indirect cost allocations, shared staff, and subawards, and it becomes painfully clear why spreadsheets alone fall short.

MissionGranted was designed with these challenges in mind. The platform integrates directly with your existing accounting systems, categorizing expenditures as they occur and aligning them with the correct Assistance Listing numbers. Subrecipient disbursements are tracked cleanly, indirect costs are applied according to policy, billing-ready reports can be generated in minutes instead of hours or days, and everything needed to complete your SEFA is at your fingertips.

By embedding SEFA compliance into daily operations, MissionGranted eliminates the scramble, reduces audit risk, and frees finance teams to focus on strategy rather than survival. The result is simple but powerful: nonprofits can approach audits with confidence, funders with transparency, and their mission with clarity.

• Ready to simplify restricted fund management? Request a demo today.