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The Small Business Administration (SBA) is moving full steam ahead with its promised 8(a) Program Audit. The 8(a) Program is designed to help small and disadvantaged businesses compete in the federal marketplace and provides certain "set-aside" opportunities, making it easier to secure federal dollar awards. As noted in our November 25, 2025, alert, the SBA announced a comprehensive review of the program to ensure strict compliance with regulations and safeguard taxpayer dollars from fraud, waste, and abuse.
On December 5, 2025, the SBA advanced this effort through publication of News Release 26-12. This News Release provided notice that letters will be issued to all 8(a) participants ordering them to produce financial records as a part of this audit effort under a quick 30-day response timeline. As a result of this order, all 4,300 8(a) program participants will have to provide financial documents for the last three fiscal years, including bank statements, financial statements, payroll register, contracting and subcontracting agreements, and employment records. Businesses failing to comply with the request by the January 5, 2026, deadline might lose eligibility to participate in the 8(a) Program and be subject to further investigation and potential remedial actions.
If you are an 8(a) contractor, expect to receive a letter from SBA shortly (if you have not already) and you will need to take action now to comply by the January 5, 2026, deadline. This includes assessment and review of all of your documentation responsive to SBA's requests. More broadly, all 8(a) participants should expect heightened scrutiny as part of this and related Department of Treasury audit efforts. Now is the time to double-check your current compliance status. If needed, the Cozen O'Connor Government Contracts team is ready to help you prepare and respond to these audits.
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