Financial and Accounting Guide for Not-for-Profit Organizations, Eighth Edition 2014 Supplement

CHAPTER 28

Audits of Federally Funded Programs

28.4 What to Expect from the Audit

(a) How Is It Different from a Financial Statement Audit?

28.6 Sweeping Changes Proposed (New)

*(a) OMB

(b) Congress

*(c) Data Collection Form

28.7 Conclusion

28.4 What to Expect from the Audit

(a) How Is It Different from a Financial Statement Audit?

p. 562. Replace the fourth paragraph with the following:

In 2011, the GAO revised the Generally Accepted Government Auditing Standards (GAGAS, commonly referred to as the “Yellow Book”) to reflect the changing audit environment in which greater transparency and accountability are expected from auditors and organizations. The 2011 revisions take into account recent changes in other auditing standards, including international auditing standards. Changes include the following:

The existing rule-based independence section was replaced with a conceptual framework for independence to provide a means for auditors to assess auditor independence to activities that are not expressly prohibited. The conceptual framework requires auditors to make independence determinations based on facts and circumstances that are often unique to specific audit environments. The conceptual framework achieves further harmonization with AICPA and international standards, with additional considerations for government audits. The 2002 GAO independence questions and answers document has been superseded.

Requirements were established for auditors performing nonaudit services at entities ...