GAC Grant Accounting & Federal Compliance 3

Question 1

What is the primary purpose of a Single Audit conducted under 2 CFR Part 200?

Accepted Answer

To provide assurance that non-federal entities expend federal awards in compliance with applicable laws, regulations, and award terms

Answer

A Single Audit provides comprehensive assurance over a non-federal entity's financial statements and federal award expenditures to verify compliance with federal laws, regulations, and the terms and conditions of awards.

Question 2

What is a 'major program' in the context of a Single Audit under 2 CFR Part 200?

Accepted Answer

A federal program selected for in-depth compliance testing based on a risk-based assessment of factors such as size and prior audit history

Answer

Major programs are selected through a risk-based approach considering factors such as expenditure size, prior audit findings, oversight, and program characteristics, as prescribed in 2 CFR Part 200 Subpart F.

Question 3

What is a 'questioned cost' in the context of a federal grant audit?

Accepted Answer

A cost that the auditor believes may not comply with applicable laws, regulations, or the terms and conditions of the award

Answer

A questioned cost is a cost identified by the auditor that is potentially unallowable because it appears to not comply with applicable laws, regulations, or award requirements, and may result in a repayment obligation.

Question 4

Under 2 CFR Part 200, what is the general record retention requirement for financial records related to federal awards?

Accepted Answer

Three years after the submission of the final financial expenditure report

Answer

The Uniform Guidance requires that financial records, supporting documents, and other grant-related records be retained for three years after submission of the final financial expenditure report for the award.

Question 5

How is a 'material weakness' in internal control over compliance defined in the context of a Single Audit?

Accepted Answer

A deficiency or combination of deficiencies where there is a reasonable possibility that material noncompliance will not be prevented or detected and corrected on a timely basis

Answer

A material weakness represents the most severe category of internal control finding, indicating that material noncompliance is reasonably possible and would not be prevented or detected through existing controls.

(GAC) Governmental Accounting Certification Practice Test

(GAC) Governmental Accounting Certification Practice Test

GAC Grant Accounting & Federal Compliance 3