Yellow Book and Single Audit Act Resources
Single Audit Resources
The Single Audit Act Amendments
The Single Audit Act gives the Office of Management and Budget (OMB) the authority to develop government-wide guidelines and policy on performing audits to comply with the Act. The most recent OMB regulation issued for that purpose is Title 2 U.S. Code of Federal Regulations (CFR) Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). It includes uniform cost principles and audit requirements for federal awards to nonfederal entities and administrative requirements for all federal grants and cooperative agreements. The previous OMB regulation containing requirements for single audits was OMB Circular A-133, Audits of States, Local Governments and Non-Profit Organizations (Circular A-133).
Accessing Key Single Audit Related Information
Here is a reference to key Single Audit Act information:
OMB Circular A-133 – Major Programs
Various regulators that monitor the quality of single audits are identifying problems with the auditor's application of the risk-based approach to determining major programs as required under Circular A-133. The risk-based approach is designed to focus the Circular A-133 audit on higher risk programs. To assist you in understanding the risk-based approach, with respect to Circular A-133's requirements for major program selection, please visit:
Understanding the Single Audit Environment
Here is a summary of steps an auditor should undertake to be prepared for conducting
an audit in the Single Audit environment:
- Gain an understanding of the basics of OMB Circular A-133, when it
is applicable, and what it requires of the auditor.
- Understand what the compliance requirements are, how clients can identify
them, and what auditors are required to test.
- Understand the client’s responsibilities for internal control
over compliance, the various elements of COSO, and auditor responsibilities
for understanding and testing client internal control.
- Gain familiarity with the various rules and regulations that must be
complied with and the various reporting requirements for both auditors and clients
to achieve compliance.
- Know what tips there are for clients to get ready for their audits and
steps that can be taken to help ensure a quality audit is obtained.
For additional information, please visit:
http://www.aicpa.org/interestareas/governmentalauditquality/resources/pages/preparingforyoursingleauditconferencecall.aspx
https://us.aicpa.org/interestareas/governmentalauditquality/resources/singleaudit
Government Auditing Standards (Yellow Book)
To view the Government Auditing Standards 2024 Revision, please visit: https://www.gao.gov/assets/d24106786.pdf
Some of the changes in the 2024 revision of Government Auditing Standards reflect:
- an emphasis on the responsibility of an audit organization's leadership for proactively managing quality on its engagements.
- an approach that promotes scalability of the system of quality management for use by audit organizations differing in size and complexity
- a risk-based process for achieving the objectives of quality management.
- a change in approach from quality control to quality management
- flexibility for audit organizations subject to other quality management standards to avoid the burden of designing, implementing, and operating separate systems of quality management.
- promotion of proactive and effective monitoring activities and increased emphasis on tailoring monitoring activities
- provisions for optional engagement quality reviews of GAGAS engagements
- application guidance on key audit matters for when they may apply to financial audits of government entities and entities that receive government financial assistance.
Common Deficiencies Government and not-for-profit audits
For an AICPA guide containing common deficiencies for government and not-for-profit audits, please visit: https://us.aicpa.org/content/dam/aicpa/interestareas/professionalethics/resources/tools/downloadabledocuments/common-deficiencies-report-govt-and-nfp-final.pdf
a list of quality issues found in its investigations of government and not-for-profit entities audits, please visit:
http://www.aicpa.org/interestareas/professionalethics/resources/ethicsenforcement/downloadabledocuments/govermentnotforprofitreport.pdf
Yellow Book Independence
The auditor needs to understand and document:
- Management’s ability to oversee non-attest services based on
their requisite skills, knowledge and experience.
- A common understanding with management regarding responsibilities for
non-attest services.
- Significant threats to independence and application of safeguards to
mitigate any identified threats.