| Dear Center Members: |
This GAQC Alert informs you about the following important matters:
- A new GAQC practice aid related to the Coronavirus State and Local Fiscal Recovery Funds Program (CSLFRF) alternative compliance examination engagement;
- The Federal Audit Clearinghouse (FAC) is now accepting 2022 single audit submissions;
- The status of single audit submission extensions relating to recent weather events;
- The last chance to register for the final continuing professional education (CPE) rebroadcast of the 2022 GAQC Annual Required Update Webcast (see sidebar);
- The 2022 edition of the AICPA Audit and Accounting Guide, State and Local Governments (SLG Guide), is now available; and
- A slight tweak has been made to the previously announced 2022-2023 GAQC Web event calendar.
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CSLFRF Practice Aid
As described further in GAQC Alert #439, the U.S. Department of Treasury (Treasury) is permitting certain eligible CSLFRF recipients to undergo an alternative compliance examination engagement instead of a full single audit or program-specific audit. This alternative is intended to reduce the burden on eligible recipients and practitioners, as well as uphold Treasury's responsibility to be good stewards of federal funds. The engagement is required to be performed under both the AICPA Statements on Standards for Attestation Engagements and Government Auditing Standards.
According to Treasury, there are approximately 30,000 CSLFRF recipients, many of whom are small local governments that may not have received federal funding before. Although there are no definitive statistics on how many CSLFRF recipients will be eligible for the alternative compliance examination engagement, the GAQC believes there will be a substantial number performed. Therefore, to serve AICPA members and promote audit quality, the GAQC has issued, GAQC Practice Aid: Compliance Attestation Examination Engagements of Certain Eligible Recipients of the Coronavirus State and Local Fiscal Recovery Funds Program, to assist practitioners engaged to perform the CSLFRF alternative compliance attestation engagement. It is open to the public and not restricted to GAQC members only. All that is needed is an AICPA account (username and password) which anyone can establish.
The nonauthoritative practice aid is comprehensive and provides frequently asked questions and illustrative reports to assist practitioners. Topics covered include:
- Recipient eligibility considerations;
- Engagement scope, performance, and reporting considerations;
- Primers on compliance examination engagements and Government Auditing Standards requirements for attestation engagements; and
- Other resources that practitioners performing these engagements can refer to.
We encourage practitioners engaged to perform these engagements to refer to the GAQC practice aid for guidance. Additionally, the GAQC has also made the illustrative reports for this engagement available on the GAQC Illustrative Auditor’s Report Resource Center.
FAC Update
As discussed in prior GAQC Alerts, the original federal plan was for the U.S. General Services Administration (GSA) to take over hosting the FAC for fiscal year 2022 single audit submissions. However, due to delays in the transition process, the U.S. Census Bureau (Census) is continuing to accept single audit submissions for now with the transition over to GSA expected to be complete by October 1, 2023. We will communicate any developments relating to this future transition as we become aware of them.
While the Census FAC has been accepting fiscal year 2021 single audit submissions, it was not able to accept completed fiscal year 2022 single audit submissions until a new updated Data Collection Form (DCF or form) was available. The good news is that a new form was recently completed and the Census FAC has just begun accepting fiscal year 2022 single audits. Access the new 2022 DCF and Instructions.
OMB has indicated that for any 2022 submissions with fiscal periods ending between January 1, 2022, and October 31, 2022, the portion of the requirement in section 200.512(1) of the Uniform Guidance stating that single audits are due to the FAC 30 days after receipt of the auditor’s report(s), is waived. Instead, these audits will be considered on time if they are submitted within nine months after their fiscal period end date.
As it relates to the updated DCF, the following are the key changes that were made:
- Revisions were made to allow for submission of CSLFRF alternative compliance examination engagements performed for fiscal years ending in 2022 (see CSLFRF section above for more information about these engagements). The same DCF is used but instructions are provided to explain how certain fields are to be completed or left blank when the alternative engagement is performed. Further, different auditee and auditor certifications are provided when the auditee indicates it is submitting one of these engagements. Note that Treasury is directly accepting submissions of CSLFRF alternative compliance examination engagements for fiscal years ending in 2021 through a Treasury portal (see GAQC Alert #445).
- Recipients are required to include their Unique Entity Identification number(s), which is a new number that is replacing the DUNS number as an entity identifier. Note that the form also continues to ask for DUNS number information to be provided but the DUNS field is not required to be completed.
Weather-Related Extensions
As noted in GAQC Alert #446, OMB has already provided a 6-month audit submission extension due to Hurricane Fiona for Puerto Rico recipients that have due dates between September 18, 2022, and December 31, 2022. We are aware that OMB is currently working on providing audit submission extensions for recipients affected by other recent weather-related events including Hurricane Ian. But we do not yet know which entities will be provided the extensions nor how long the extensions will be. As soon as we are made aware, we will inform you via a future GAQC Alert.
AICPA SLG Guide
The 2022 edition of the SLG Guide is now available in both paperback and e-book formats. It is a key resource for auditors performing state and local government financial statement audits. Access purchase information. This edition of the guide includes:
- A new chapter that addresses accounting and financial reporting standards for leases for both lessees and lessors and auditing considerations for lessees. The chapter provides readers with an overview of the accounting and practical application of the lease guidance under Governmental Accounting Standards Board (GASB) Statement No. 87, Leases, as amended. It also addresses auditing considerations for lessees. Although no specific audit guidance is included for lessors, the audit guidance for lessees may be adapted as appropriate for lessors.
- Updates for other recently effective GASB standards.
- Dual guidance to introduce SAS No. 142, Audit Evidence, which is effective for periods ending on or after December 15, 2022.
- A new disclaimer of opinion report example (A-12) has been added to the audit reporting chapter to illustrate a report on basic financial statements that includes multiple opinion modifications, including a disclaimer of opinion. Although issuing a disclaimer of opinion when reporting on governmental financial statements is not common, we periodically get requests from members needing to issue such reports and this new report was developed to assist in those situations.
Schedule Tweak
GAQC Alert #446 indicated that our November GAQC Web event, Hot Topics in Auditing Pandemic Funding, would be held on November 16, 2022. We wanted to alert you that the date of this event has been revised. The event will now be held on Tuesday, November 29, 2022, from 1:00 – 3:00 PM (Eastern Time). Please revise your calendar hold to reflect this change and look for registration information for this event soon.* * * * *
Sincerely,
AICPA Governmental Audit Quality Center |
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| In This Alert |
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| Last Chance |
| The final CPE rebroadcast of the 2022 GAQC Annual Required Update Webcast will be held on Wednesday, November 9, 2022, from 1:00 – 3:00 PM (Eastern Time). Access registration information. Don't need CPE? View a no-CPE archive. Remember that the annual required GAQC compliance questionnaire will be sent by the end of calendar year, and you will be asked to certify your attendance. |
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| Additional Resources |
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| Stay Informed |
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