Laws, Regulations, Audit Standards

The Federal Government and its constituent departments and agencies earn no income and have no profitability concerns. The Federal Government can, however, print money, write checks, borrow money, and spend. By law, Federal Agency executives are responsible for the accurate and timely accounting, controlling, and reporting of the receipts, disbursement, and application of public monies. For over 200 years, Congress, by legislation, has attempted to control these financial activities through a process that includes authorizing, appropriating, and budgeting authority approvals relating to raising and spending Federal funds. Other laws offer criteria directing Federal departments and agencies to better plan, manage, and monitor their operations and to do so in a more economical, efficient, and effective manner. These responsibilities lead to peculiarities and variations for Federal entities that are not the same for private sector organizations.

The financial management laws of direct concern to Federal financial executives and auditors of Federal operations and activities are listed next and described in more detail in this chapter. The provisions of these laws establish the financial and operational criteria that must be subjected to scrutiny during the annual independent audit of an agency’s financial statements. Selected provisions of several of these laws and regulations are of direct concern to those conducting ...

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