Transcript Slide 1

Audits of Small
Governments
Unraveling the Mystery of Auditing
May 7, 2012
Presented by:
Debbie Goode, CPA
Partner
Carr, Riggs & Ingram,
LLC, CPA’s and Advisors
215 Baytree Drive
Melbourne FL 32940
321-255-0088
Planning Phase
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Client Acceptance
Review prior Auditor workpapers
Planning meeting with client
Read all relevant documents, including
minutes
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“EXCEEDING EXPECTATIONS”
Planning Phase (continued)
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Assess internal controls and walkthroughs
Calculate materiality
Assess risk, including fraud risk
Develop audit program
Audit team planning meeting
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“EXCEEDING EXPECTATIONS”
How is materiality calculated?
• Governmental activities, business-type
activities by major fund, aggregate discretely
presented component units, all aggregately
remaining fund info
• Planning materiality
• Tolerable misstatement
• Low risk/high risk by area
• Passed AJE’s
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“EXCEEDING EXPECTATIONS”
Types of Audit Testing
• Substantive
• Internal Control
• Compliance
• Analytics
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“EXCEEDING EXPECTATIONS”
Efficient Audits
• Planning meeting
• PBC list
• Send auditors information in
advance
• Internal controls documented
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“EXCEEDING EXPECTATIONS”
Efficient Audits (continued)
• Walk-throughs before year end
• Fraud confirms
• Confirms out before audit fieldwork
• Audit fieldwork – auditors in field
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“EXCEEDING EXPECTATIONS”
Efficient Audits (continued)
• Exit conference with partner
involved
• Go over financial statement
draft/reports/comments
• Signed rep letters
• Partner presents to Council
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“EXCEEDING EXPECTATIONS”
Reports Issued
• Audit Report
• Internal control and compliance
• Single Audit internal control and
compliance*
• Auditor General of Florida requires
management letter
*if applicable
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“EXCEEDING EXPECTATIONS”
Compliance with Florida Law
• Level of testing up to auditor.
• Bid testing.
• Travel and entertainment.
• Change annually.
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“EXCEEDING EXPECTATIONS”
Financial Condition Assessment
• Benchmarks against similar size entities –
population or revenues.
• Looks at five year trends.
• Favorable, unfavorable, inconclusive.
• If unfavorable > 60%, auditor must report.
• Can pull out entities not truly comparable.
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“EXCEEDING EXPECTATIONS”
Internal Controls
• Significant material deficiency
• Significant deficiency
• Remainder - Management Letter
comments
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“EXCEEDING EXPECTATIONS”
Data Collection Form
• If have federal single audit, required.
• Must be filed earlier than 30 days after
receipt of auditor’s reports or nine
months after fiscal year end.
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“EXCEEDING EXPECTATIONS”
Single Audit Reports
• Schedule of Expenditures of Federal Awards
and State Financial Assistance
• Internal control and compliance over Federal
awards and/or State financial assistance.
• Schedule of Findings and Questioned Costs
• Summary Schedule of prior year audit
findings.
• Corrective Action Plan
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“EXCEEDING EXPECTATIONS”
Single Audits – Federal and State
• When do you need one?
• $500,000 of expenditures during year
• How to identify major programs:
•Type A
•Type B
•ARRA
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“EXCEEDING EXPECTATIONS”
Single Audits – Federal and State
(continued)
• Must calculate materiality for all major
programs.
• Must document controls in place and test
they are functioning.
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“EXCEEDING EXPECTATIONS”
Single Audits – Federal and State
(continued)
• Testing based on CFDA and CSFA
(see Compliance Supplement Matrix –
www.whitehouse.gov/omb/circulars/A133_compliance_supplement2011)
• Test for compliance to grant agreement
and compliance supplement.
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“EXCEEDING EXPECTATIONS”
Schedule at a Glance
• Tuesday May 8, 2012
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10:00 a.m. - 11:40 a.m.
GFOA CAFR Award Program – Linda Dufresne and Sarah Koser
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10:00 a.m. - 11:40 a.m.
How to Invest With Fewer Dollars? – Jeff Larson, Linda Senne and
Jeffrey Yates
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10:00 a.m. - 11:40 a.m.
Strategies to Address Aging Infrastructure – Celine Hyer
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10:00 a.m. - 11:40 a.m.
Making Technology Work for You! – Steve Murray and Darrel Thomas
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10:00 a.m. - 11:40 a.m.
Debt Affordability & Policies – Mickey Miller
• 2:00 p.m. - 2:50 p.m.
Statewide Chart of Accounts Project – Elwood McElhaney
• 2:00 p.m. - 2:50 p.m.
Gimmie A Budget Light Please! – Brenda Raver
• 2:00 p.m. - 2:50 p.m.
Ethics Review – Peggy McGarrity
• 2:00 p.m. - 2:50 p.m.
Career Development: Building the Next Finance Director – Mark
Fostier, Binh Nguyen, Diane Reichard and Jamie Roberson
• 2:00 p.m. - 2:50 p.m.
Pension Risk Management and Asset Allocation – Kevin
SigRist
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• 3:10 p.m. – 4:50 p.m.
Are You Audit-Ready? – Deborah Garringer and Bill Spinelli
• 3:10 p.m. – 4:50 p.m.
Fraud, Internal Controls and Segregation of Duties for Small
Governments – Angela Balent and C. Michelle Blackstock
• 3:10 p.m. – 4:50 p.m.
Preserving Your Reserves – Jason Brown
• 3:10 p.m. – 4:50 p.m.
Yikes! You’ve Been Hacked! – Princessa Brown
• 3:10 p.m. – 4:50 p.m.
Review of the Dodd-Frank Act – Jim Reilly and Ravi
Subbaraya
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