Dear Center Members
Available Resources to Help Improve Your Single Audit Quality
AICPA Releases Single Audit Fundamental Series
Important Updated AICPA Single Audit–Related Publications
Other GAQC Single Audit Tools
The main purpose of this GAQC Alert is to ensure that you are aware of the various single audit resources the Government Audit Quality Center (GAQC) has available to you as you perform your upcoming single audits. After reading this GAQC Alert you will learn more about:
- The recent release of a Single Audit Fundamentals series of continuing professional education (CPE) courses that were developed from the GAQC Web events held earlier this year.
- The availability of the 2010 AICPA Audit Guide, Government Auditing Standards and Circular A-133 Audits, which has been updated for Statement on Auditing Standards (SAS) No. 117, Compliance Audits, and a related Audit Risk Alert.
- A summary of the various other tools released by the GAQC to assist you with your upcoming single audits.
In line with its mission to enhance governmental audit quality, the GAQC has been busy over the last several years developing guidance on performing single audits. This GAQC Alert provides you, in one place, a summary listing of all of the resources available to you. As auditors that perform single audits, you know how complex they can be and the challenges they can present. Additionally, you are also aware of the intense scrutiny on the quality of these engagements, particularly in light of the enactment of the American Recovery and Reinvestment Act of 2009. The GAQC encourages you to take advantage of the resources below and to watch future GAQC communications for further updates on the latest single audit activities.
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AICPA Releases Single Audit Fundamental Series Based on GAQC Member Events
You might remember that earlier this year, the GAQC offered a four week series of single audit fundamentals Web events that were provided with an option for CPE. These events were offered in direct response to feedback received from our members that there is a need for basic single audit training for staff that are new to performing single audits and were very well received. As is our usual practice, the series was then archived on the GAQC Web site for our members to take advantage of. However, CPE has not been available for listening to the archived version of the events.
We are now pleased to report that the single audit fundamental series is now available for CPE. Working with the GAQC, the AICPA converted the GAQC events into a series of four on-demand courses entitled, InSight: Single Audit Fundamentals On-Demand Series. These courses incorporate the underlying elements and information from the GAQC series and present it in an interesting and informative e-learning format that your staff can take advantage of right from their desktops. The on-demand series is available for purchase as a complete series that includes access to all four parts or you can purchase each part individually. The four parts include the following:
- Single Audit Fundamentals Part I: Background and Overview
- Single Audit Fundamentals Part II: The Mysteries of Major Program Determination
- Single Audit Fundamentals Part III: Understanding and Testing of Controls and Compliance
- Single Audit Fundamentals Part IV: Reporting Requirements and Available Resources
Click here to access the purchasing information for InSight: Single Audit Fundamentals On-Demand Series. Because we understand that not all of our members are interested in the CPE component, we will continue to maintain the GAQC archived version of this series for GAQC members at no cost. You can click here to access this no-CPE option.
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Important Updated AICPA Single Audit-Related Publications Now Available
In late August, the 2010 edition of the AICPA Audit Guide, Government Auditing Standards and Circular A-133 Audits, was released. This Guide is a critical resource for auditors performing single audits and includes conforming updates as of May 1, 2010. This edition of the Guide is particularly important in that it has been updated to reflect the provisions of the recently effective SAS No. 117 (see section below). Click here to learn more and to order your copy.
The AICPA's Audit Risk Alert, Government Auditing Standards and Circular A-133 Developments, has also recently been issued. This alert focuses on emerging practice issues and current developments, including the impact of the American Recovery and Reinvestment Act of 2009 on single audits. It also provides you with updates on the activities of the Government Accountability Office (GAO), Office of Management and Budget (OMB), and Federal Audit Clearinghouse. Click here to learn more about this publication and how to order it.
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Other GAQC Single Audit Tools
Preparing Auditees for a Single Audit. Auditees play a key role in the single audit process. As noted in the GAQC Senate testimony prepared in response to the President's Council on Integrity and Efficiency report titled, Report on National Single Audit Sampling Project (the PCIE report), the GAQC believes that meaningful improvements in single audit quality will only occur when all of the key single audit stakeholder groups—the auditing profession, procurers of single audit services, and the federal agencies—are involved in the solution. Therefore, the GAQC hosted a Web event titled, Preparing for Your Single Audit: An Auditee Perspective, which is primarily intended to help auditees better understand the requirements of Circular A-133 and other reference documents (e.g., the various cost circulars), the various responsibilities placed on auditees, the importance of hiring a qualified auditor, and tips for preparing for a single audit. Among the many topics covered, this event discusses the compliance requirements and provides an overview of the auditee's responsibility for both compliance and internal control over compliance for federal programs. To access this archived event which has been left open to the public, click here.
New Compliance Auditing Standard. SAS No. 117, Compliance Audits, was developed by the AICPA's Auditing Standards Board, working with the GAQC, in direct response to the federal study on single audit quality that was issued several years ago. Issued in December 2009, the new SAS was effective for compliance audits for fiscal periods ending on or after June 15, 2010. Click here to obtain a copy of SAS No. 117. As noted in the previous section, the Audit Guide, Government Auditing Standards and Circular A-133 Audits, has also now been updated for SAS No. 117.
Archived GAQC Web Event on SAS No. 117. An archive of the GAQC Web event titled, The New Compliance Auditing SAS and an Update on Other AICPA Auditing Standards, is also available to GAQC members on the GAQC Web site. The main purpose of this archived Web event is to provide you with a better understanding about SAS No. 117 and what it requires. Click here to access this archived Web event.
Compliance and Internal Control over Compliance Practice Aids. As noted in GAQC Alert #149, the GAQC developed several illustrative Practice Aids to assist auditors in understanding the procedures to be performed and the related auditor documentation in a single audit when gaining an understanding of internal control over compliance and testing compliance and internal control over compliance. This is an area that was found to be problematic in the federal study on single audit quality. The Practice Aids are as follows:
A major program risk matrix provides auditors with a template to illustrate how they might document which of the 14 types of compliance requirements ultimately will be subject to audit for each major program.
A comprehensive controls overview document which is available in a narrative and checklist format to illustrate how an auditor might document the audit work associated with internal control over compliance for the types of compliance requirements selected for testing for each major program.
A dual purpose testwork illustration showing how an auditor might document the use of one sample to test both internal control over compliance and compliance.
These practice aids are available in a single electronic downloadable publication titled, Documenting and Testing Compliance and Internal Control Over Compliance in a Single Audit
(product no. 006662PDF) that is available at the AICPA Store for a nominal fee (i.e., $39.99 for AICPA members) and can be ordered by clicking here
. This electronic document includes each Practice Aid in a PDF format that auditors can use to input their auditor documentation. GAQC members can also access free word and excel versions of these practice aids on the GAQC Web site by clicking here
Archived GAQC Web Event on Internal Control and Compliance Responsibilities
. An archive of the GAQC Web event titled, Internal Control Considerations in Single Audits
, is also available to GAQC members on the GAQC Web site. The main purpose of this archived Web event is to provide you with a better understanding about what OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations
(Circular A-133), requires of the auditor in terms of compliance and internal control over compliance. Click here
to access this archived Web event.
Schedule of Expenditures of Federal Awards (SEFA) Practice Aids
. The GAQC released two Practice Aids directed at auditors—an illustrative audit program and a SEFA disclosure checklist in response to quality issues identified in this area. The audit program will assist you in ensuring that you are considering the various auditor responsibilities for the SEFA and the checklist will provide you with a mechanism to check whether auditees have included the required elements in the SEFA. Additionally, because the SEFA is an auditee-prepared schedule, the GAQC also developed two Practice Aids directed at auditees—a worksheet for identifying federal program information and a SEFA disclosure checklist. Both the auditor and auditee Practice Aids are available on the GAQC Web site
to both members and non-members by clicking here
. Additionally, the auditor practice aids have been incorporated as illustrations in chapter 7, Schedule of Expenditures of Federal Awards
, of the 2010 edition of the AICPA Audit Guide, Government Auditing Standards and Circular A-133 Audits
(see section above for more information on this Guide).
Archived GAQC Web Event on the SEFA
. An archive of the GAQC Web event titled, The New GAQC Schedule of Expenditures of Federal Awards Practice Aids and Other Related Issues
, is also available to GAQC members on the GAQC Web site. The main purpose of this archived Web event is to provide you with a better understanding about your audit responsibilities for the SEFA, as well as the auditor and auditee SEFA Practice Aids described in the previous paragraph. Click here
to access this archived Web event.
Sampling in a Single Audit Environment Audit Guidance
. In response to criticisms in the federal study on single audit quality, the GAQC also developed a new chapter titled Sampling in a Single Audit Environment
, that was incorporated into the 2009 edition of the AICPA Audit Guide, Government Auditing Standards and Circular A-133 Audits
. Note that this chapter is also included in the more recently issued 2010 edition of the Guide (see above section). The chapter, which was effective upon issuance, is comprehensive and covers the specific nuances of sampling in a single audit. It also includes sample size tables. An executive summary of the chapter can be found on the GAQC Web site by clicking here
Archived GAQC Web Event on Sampling in a Single Audit Environment
. An archive of the GAQC Web event titled, AICPA's New Guidance on Sampling in a Single Audit Environment
, is also available to GAQC members on the GAQC Web site. The main purpose of this archived Web event is to assist you in understanding the AICPA's new single audit sampling guidance described in the previous paragraph. Click here
to access this archived Web event.
Peer Review Checklists
. Note that the AICPA's peer review program has revised the peer review checklist, Supplemental Checklist for Review of Single Audit/A-133 Engagements
, including breaking the document down into two parts, to facilitate the peer review process over these engagements. The first part focuses in on areas found to be particularly problematic in the federal study on single audit quality. The GAQC encourages you to use this peer review checklist as an additional tool for use in your internal inspection and quality control programs. Taking this step may help you improve the quality of your governmental audits. Click here
to access this peer review checklist, as well as others that might be relevant to your governmental and not-for-profit organization (NPO) audits. Note that the GAQC's Web event titled, AICPA Peer Review: What is Changing and How Being a Peer Reviewer Can Enhance Your Practice
, to be held on October 7, 2010 (see GAQC Alert #152
for registration information), will also be archived on the GAQC Web site after the live event occurs. GAQC members will be able to access it on the GAQC archived member Web event page which can be found by clicking here
Illustrative Auditor Reports
. The GAQC posts illustrative auditor reports for Government Auditing Standards
and Circular A-133 audits on the GAQC Web site. The latest reports are excerpts from the 2010 AICPA Audit Guide, Government Auditing Standards and Circular A-133 Audits
, and are updated for both SAS No. 115, Communicating Internal Control Matters Identified in an Audit
, and SAS No. 117. Click here
to access the illustrative reports.
Recovery Act Resource Center
. Keep in mind that the best place to go for guidance on the effect of the Recovery Act on your 2010 single audits is the GAQC's Recovery Act Resource Center
. This Center, which is open to the public and available on the GAQC Web site, includes several archived GAQC Web events featuring industry experts and federal regulators; access to previous GAQC Alerts
communicating timely Recovery Act guidance from OMB and others; links to OMB guidance related to the Recovery Act that specifically impacts auditors; and other useful tools and information. Click here
to access the Center.
GAQC Annual Webcast
. The archived 2010 GAQC Webcast covered the latest developments in governmental and NPO audits, including single audits, for the purpose of preparing our members for the 2010 audit season. The viewing of the Webcast is a GAQC membership requirement for each firm's Designated Audit Quality Partner (DAQP) and state audit organization's Designated Audit Quality Leader (DAQL). It also continues to be a valuable resource for member staff that are not serving in the DAQP or DAQL role. While we know that many of our DAQPs, DAQLs, and their staff took the encouraged approach to view the live Webcast, we also know that schedules are busy and not everyone was able to do so. Therefore, the GAQC is providing our members with the option of purchasing (for a small fee) a self-study course titled, GAQC 2010 Annual Webcast Update On-Demand Self-Study Course
that will provide 3 hours of CPE for viewing the archived Webcast. Additionally, the GAQC is also offering a no-CPE option for those members that view the archived Webcast but would prefer not to receive CPE. Click here
to learn more about both the CPE and the no-CPE option.
The GAQC Team will continue to keep you up-to-date on the latest developments concerning single audit quality via GAQC Alerts and the GAQC Web site
. However, please be proactive and visit www.aicpa.org/GAQC
under "Spotlight On" for the very latest happenings often and mark us as a favorite in your Web browser.
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