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General Standards 

Government Auditing Standards include general standards, as well as fieldwork and reporting standards that are in addition to those required by generally accepted auditing standards (GAAS). The Government Auditing Standards general standards are in the following areas: independence, professional judgment, competence, quality control and assurance. You should refer to the 2003 Government Auditing Standards for a full description and understanding of its general standards; however, each is summarized in the table below.  If you are performing your audit using the 2007 revision of Government Auditing Standards you should click here to access the 2007 revision and its General Standards.

Topic Area

The Government Auditing Standards General Standard Related to This Topic is:

Additional Commentary

Independence

In all matters relating to the audit work, the audit organization and the individual auditor, whether government or public, should be free both in fact and appearance from personal, external, and organizational impairments to independence.

 

 

 

The detailed requirements underlying this standard are in some cases very similar to the AICPA independence rules and in other cases more restrictive, particularly the provisions governing nonaudit services. The Government Accountability Office (GAO) has issued a question and answer document titled Answers to Independence Standard Questions, which responds to questions related to its independence standard. The AICPA has also prepared a summary of the differences between the GAO and AICPA independence rules relating to nonaudit services.

Professional Judgment

Professional judgment should be used in planning and performing audits and attestation engagements and in reporting the results.

This standard is similar to the AICPA's general standard on due professional care in Statement on Auditing Standard (SAS) No. 1, Codification of Auditing Standards and Procedures, section 230 ( AICPA, Professional Standards, vol. 1, AU sec. 230 , "Due Professional Care in the Performance of Work"), as amended.

 

 

 

Competence

The staff assigned to perform the audit or attestation engagement should collectively possess adequate professional competence for the tasks required. 1

Government Auditing Standards build upon the AICPA's general standard on auditor qualification in SAS No. 1, Codification of Auditing Standards and Procedures, section 210 ( AICPA, Professional Standards, vol. 1, AU sec. 210 , "Training and Proficiency of the Independent Auditor"), as amended, by requiring that an audit organization have a process for maintaining a competent workforce. One of the areas that process should address is continuing professional education (CPE). Every two years, each auditor (whether certified or not) performing audits in accordance with Government Auditing Standards who (a) is involved in planning, directing, or reporting on the audit or attestation engagement or (b) charges at least 20 percent annually of his or her time to audits and attestation engagements following Government Auditing Standards  should complete at least 80 credit hours of training that directly enhances the person's professional proficiency to perform audits or attestation engagements. At least 20 of those hours should be completed in any one year of the two-year period. In addition, at least 24 of the 80 hours of CPE should be in subjects directly related to government auditing, the government environment, or the specific or unique environment in which the audited entity operates. There is an exception to the rules above for those auditors who (a) only perform field work but do not plan, direct, or report on the audit or attestation engagement and (b) charge less than 20 percent annually of their time to audits and attestation engagements following Government Auditing Standards. Those auditors who meet the above criteria are required to take 24 hours of training in each 2-year period in subjects and toipcs directly related to government auditing, the government environment, or the specific or unique environment in which the audited entity operates; they are not also required to comply with the 80-hour CPE requirement.  Government Auditing Standards also states that the audit organization is responsible for ensuring that auditors meet the CPE requirements and should maintain documentation of the CPE completed. The GAO has issued Guidance on GAGAS Requirements for Continuing Professional Education which provides additional guidance to auditors and audit organizations implementing the CPE requirements prescribed by Government Auditing Standards. 2

Quality Control and Assurance

Each audit organization performing audits and/or attestation engagements in accordance with generally accepted government auditing standards should have in place and monitor an appropriate internal quality control system and should undergo an external peer review at least once every three years. 3

Government Auditing Standards contains requirements for the conduct of the peer review, which should determine whether the internal quality control system was adequate and whether the audit organization complied with its quality control policies and procedures.  Further, the audit organization must document its quality control system, retain documentation of compliance for a period of time sufficient to enable monitoring and peer reviews, and to take remedial, corrective actions based on the results of the peer review. 

 

 


 

1  Paragraph 3.42 of the 2003 revision of Government Auditing Standards provides a listing of the types of technical knowledge and skills that staff members should collectively possess.  Click here to link to paragraph 3.42.

 

2The guidance in this paragraph is based on guidance issued by the GAO in April 2005. The GAO issued Technical Amendment to the CPE Requirements of the 2003 Revision of Government Auditing Standards and Guidance on GAGS Requirements for Continuing Professional Education, which are effective for CPE measurement periods beginning on or after June 30, 2005. The amendment revised the requirements for both the 80-hour rule and the 24-hour rule. GAO documents are available on GAO’s Government Auditing Standards Web site at www.gao.gov/govaud/ybk01.htm.

 

3 Government Auditing Standards provides that audit organizations have an external peer review conducted within three years from the date of the start of fieldwork of their first assignment in accordance with Government Auditing Standards. Subsequent external peer reviews should be conducted every three years. Only the GAO can grant extensions of these time frames beyond three months and audit organizations should only request such extensions for extraordinary circumstances.

 

 

Copyright © 2004 by the American Institute of Certified Public Accountants, Inc., New York, New York.

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State

Overview :  The AICPA State Regulation and Legislation Team advocates for the accounting profession at the state level by partnering with the state CPA societies. The team monitiors trends on key state legislative and regulatory issues at the national level and serves as an information clearinghouse and resource provider, offering information related
Published on February 10, 2012

Continuing Professional Education

Link :  Each CPA must complete Continuing Professional Education credits each year. Learn more about earning Continuing Education Credits (CPEs) and AICPA, state society, and state board CPE requirements.
Published on February 10, 2012

CPE Requirements

Article :  Continuing professional education (CPE) is required for CPAs to maintain their professional competence and provide quality professional services.
Published on February 10, 2012

The International Qualification Examination (IQEX)

Article :  The International Qualification Examination (IQEX) was developed to facilitate the U.S. CPA qualification process for accounting professionals from other countries whose professional bodies enter into mutual recognition agreements with the U.S. accounti
Published on February 10, 2012

International Applicants

Overview :  International candidates are eligible to qualify as U.S. Certified Public Accountants (CPAs) as long as they meet Board of Accountancy eligibility requirements in one of 54 U.S jurisdictions - the 50 states, District of Columbia , Puerto Rico , U.S. Virgin Islands, and Guam.
Published on February 10, 2012

Users and User Entities

Article :  Many companies function more efficiently and profitably by outsourcing tasks or entire functions to service organizations that have the personnel, expertise, equipment, or technology to accomplish these tasks or functions. Examples of  such services incl
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OnSiteTraining

Article : 
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Tax Legislation and Policy

Overview :  The AICPA has a long history of advocating for sound tax policy.  This section contains: AICPA-developed tools to evaluate tax provisions and proposals from a tax policy standpoint; AICPA tax reform studies to promote informed tax policy decisions; advocacy documents; and other tax policy related materials.
Published on February 10, 2012

International Tax

Overview :  This section covers international taxation issues and contains professional standards and ethics, legislation, regulation, and administration, tools and aids, and useful Web site links.
Published on February 10, 2012

Tax Power Hour

Overview :  The Tax Power Hour is a monthly webinar series for tax section members only that is hosted generally on the third Thursday of the month from 1:00 to 2:00 pm (eastern).  This page lists upcoming dates and subjects and also contains registration links, as well as links to archives of prior
Published on February 10, 2012

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