U.S. "One Big Beautiful Bill" 2025: What It Means for Internal Audit, Governance, Risk, and Compliance Teams
July 2025 | Advisory Insights
The Senate’s recent passage of the One Big Beautiful Bill Act (OBBBA) has sent shockwaves across sectors—from federal agencies to Fortune 500 boardrooms. While headlines focus on its political drama, internal auditors, risk managers, and compliance teams should pay close attention to the operational ripple effects.
The bill, a sweeping reconciliation package, touches nearly every corner of the economy: tax extensions, defense funding, immigration enforcement, deep cuts to social programs, and reduced clean-energy incentives. Despite assurances that “flight schedules are on time” in D.C., the financial governance landscape is shifting—fast.
Key Impacts on Audit and Risk Functions
1. Financial Forecasting Under Pressure
The Congressional Budget Office (CBO) estimates that OBBBA could increase the national deficit by up to $3.3 trillion over the next decade. For finance leaders and internal auditors, this raises red flags for long-term fiscal planning, federal grant dependency, and budget sensitivity analysis.
Action: Audit teams should revisit forecasting models, particularly those tied to public funding, infrastructure, or compliance grants.
2. Medicaid and SNAP Cuts—Compliance Whiplash Ahead
The bill includes nearly $800 billion in cuts to Medicaid and SNAP over 10 years. This has major implications for healthcare and non-profit sectors, particularly those reliant on public reimbursements or managing state contracts.
Action: Conduct a risk-focused review of program eligibility processes, vendor oversight, and state-level regulatory changes.
3. Oversight Shakeups
Originally proposing the elimination of the PCAOB and slashing CFPB funding, the bill sparked outcry. While these provisions were ultimately ruled out of bounds in the Senate, they signal a shift in priorities—away from stringent oversight and toward deregulation.
Action: Firms should monitor any structural changes in the audit ecosystem and prepare for increased demands on internal assurance in the absence of external checks.
4. ESG Disclosure Strategy at Risk
With major rollbacks to clean-energy tax incentives, organizations with long-term ESG strategies may need to rethink their climate commitments—or at least their funding assumptions.
Action: Internal audit should validate climate-related tax treatments, deferred tax assets, and public ESG disclosures under the new policy direction.
What Should Internal Audit Do Now?
- Run Ransomware-Style Tabletop Exercises
Budget shifts may reduce investment in cybersecurity—test your resilience. - Audit Federal Program Dependencies
Identify business units or operations that rely on Medicaid, SNAP, or federal tax credits. Review your controls. - Update ESG Assurance Plans
Validate climate-related assumptions, KPIs, and disclosures. If clean-energy incentives are pulled, what’s the financial impact? - Track Regulatory Change
Be the early-warning system. Create a watchlist of pending regulations, PCAOB/CFPB reforms, and compliance shifts tied to OBBBA.
The One Big Beautiful Bill isn’t just political theater—it’s a strategic inflection point for corporate governance, financial controls, and risk management. Audit leaders should proactively evaluate their exposure and act decisively.
Stay ahead. Stay compliant. Stay confident.
Primary Source:https://www.theguardian.com/us-news/2025/jul/01/senate-passes-big-beautiful-bill-vote?utm
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