Public Sector Compliance and Regulations Flashcards

Which principle requires government auditors to be free from personal, external, and organizational impairments to independence?

Answer: Independence in fact and appearance

GAGAS requires auditors to maintain independence in both fact (actual state of mind) and appearance (perception by others) throughout the audit.

Under GAGAS, what is required when an auditor identifies a violation of provisions of contracts or grant agreements?

Answer: Report the violation in the audit report unless clearly inconsequential

GAGAS requires auditors to report violations of contract or grant provisions in the audit report unless the violations are clearly inconsequential.

What is a 'finding' in a government performance audit report?

Answer: A structured presentation of criteria, condition, cause, and effect identifying a deficiency or noteworthy achievement

A finding in a performance audit presents the criteria (what should be), condition (what is), cause (why), and effect (so what) to explain the significance of an issue.

Which act established the framework for congressional oversight of federal programs through regular reporting of performance results?

Answer: Government Performance and Results Act (GPRA) of 1993

GPRA of 1993 required federal agencies to develop strategic plans, set performance goals, and report annually on results, creating a results-oriented management framework.

What does 'materiality' mean in the context of a government financial statement audit?

Answer: The magnitude of a misstatement or omission that could influence decisions of users of the financial statements

Materiality is the threshold at which a misstatement or omission could reasonably be expected to influence the decisions of financial statement users.

Under the Federal Managers' Financial Integrity Act (FMFIA), what are agency heads required to do annually?

Answer: Provide a statement of assurance on the effectiveness of internal controls and financial systems

FMFIA requires agency heads to provide an annual assurance statement to the President and Congress on the adequacy of internal controls and compliance with financial system requirements.