AICPA Comments on Key Single Audit Matters

The American Institute of CPAs’ (AICPA) Governmental Audit Quality Center (GAQC) provided comments recently to the Office of Management and Budget (OMB) on two key documents used by auditors when performing single audits of federal funds expended by states, local governments, and not-for-profit organizations.

First, the GAQC provided comments to OMB on proposed changes to the Data Collection Form and its instructions.  This Form, submitted at the end of every single audit, is completed by the auditor and the auditee and summarizes the results of the audit.  OMB issued a Federal Register Notice on December 9, 2015, which proposed changes to the Form and its instructions, primarily to make updates to reflect changes needed for 2 CFR Part 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Overall, the February 10 GAQC letter indicates support for OMB updating the Form for the Uniform Guidance.  However, the comprehensive letter also includes a number of specific comments on the Form and its instructions, as well as several overarching comments.  Among the topics covered in the letter are concerns about the time estimates included in the notice for completing the Form; burdens associated with previous Form delays and the shutdown of the Federal Audit Clearinghouse; inconsistencies between the proposed Form and the Uniform Guidance; and issues with the proposed auditor certification statement. 

Second, members and staff of the GAQC have also completed their annual review of a draft of the 2016 Compliance Supplement. The Compliance Supplement is a key document used by auditors when performing single audits.  It identifies the compliance requirements the federal government expects to be considered as part of a single audit and provides audit objectives and suggested audit procedures for determining compliance. Each year, OMB provides key stakeholder groups, including the GAQC, an opportunity to informally review a vett draft of this important document.  The GAQC comment letter provided to OMB includes numerous significant, general, and specific comments on various sections and programs included in the Supplement.  Overall concerns were also expressed regarding confusion surrounding individual federal agency adoption of the Uniform Guidance regulation and the level to which federal agencies are diverging from the Uniform Guidance in their own regulations.