Transcript GAGAS TRAINING - Electronic Resource Center

Performance, Financial and
Compliance Audits
Pennsylvania Department of the Auditor General
Thomas E. Marks
Deputy Auditor General for Audits
Auditing Standards
GAGAS
Generally
Accepted
Government
Auditing
Standards
GAGAS says audits are
completed with:
•
•
•
•
Competency
Integrity
Objectivity
Independence
Three Types of Audits
Financial Audits
Attestation Engagements
Performance Audits
Financial Audits
• Auditor renders an opinion on the fairness
of the statement in accordance with GAAP
• FASB—non-government
• GASB—State and Local Government
• Report consists of financial statements as
well as findings and recommendations
Attestation Engagements
No more financial related audits
Financial audits of forms or
schedules
Performance Audits
• Objective and systematic assessment of
managements’ performance relative to a
program
• Need objective criteria
• Provides information to improve
operations
• Facilitates decision-making
• Improve public accountability
Examples of Performance Audits
•
•
•
•
Program effectiveness
Economy and efficiency
Internal control
Compliance with legal or other
requirements
• Reports consist of findings, conclusions
and recommendations
Program Effectiveness
Is the program achieving its goals
and objectives?
Economy and Efficiency
• Is the entity acquiring, protecting and
using its resources in the most productive
manner?
Compliance Audits
• Compliance with:
– Laws
– Regulations
– Contract provisions
– Grant agreements
Planning
• Objectives
– What is to be accomplished?
– Answers to questions designed by auditors
Planning
Some planning considerations
1. Visibility of the program
2. Potential users
3. Laws and regulations
4. Policies and procedures
5. Criteria!
6. Staffing
Evidence
• Sufficient, competent and relevant
evidence is to be obtained to provide a
reasonable basis for the auditors’ findings
and conclusions.
Report Contents
The audit report should include the
objectives, scope and methodology; the
audit results, including findings,
conclusions, and recommendations, as
appropriate; a reference to compliance
with generally accepted government
auditing standards; the view of responsible
officials; and if applicable, the nature of
any privileged and confidential information
omitted.
Form
Views of responsible officials
1. Management comments
2. Helps promote a balanced and fair report
3. Auditors should include in their report a
copy of the officials’ written comments or
a summary of the comments received.
(8.31)
Form
Views of responsible officials
1. Oral comments okay if:
• Time is critical
• Parties have worked closely together
throughout the audit and know all the
issues
• No major disagreements or
controversies are expected
Form
Views of responsible officials—what if
management disagrees?
1. State why auditors disagree in a fair
and objective manner
2. Consider changing the report
Reporting Quality Elements
Objective
1. Balanced in content and tone
2. Fair and not misleading
3. Sound and logical
4. Recognize the positive
Reporting Quality Elements
Convincing
1. Persuasive
2. Reasonable recommendations
3. Show the benefit of implementing the
recommendations
Bureau of School Audits
Continuing Audit Objectives
Funding Issues
• Membership
• Transportation
Other Compliance Issues
• Teacher certification
• Bus driver qualifications
– Also program effectiveness
Employment Contracts
• Program effectiveness
• Compliance
Bureau of School Audits
New and Emerging Issues
School Safety
• Program effectiveness
• Compliance