Governmental Audits

Question 1

What is an objective of a performance audit?

Answer 1

To determine whether an entity’s specific operating units are functioning economically and efficiently

Question 2

What should the auditor’s report disclose when procedures disclose material instances of noncompliance with regulations?

Answer 2

That the report Place the findings in proper perspective

Question 3

What governing body issues standards for audits of recipients of federal awards?

Answer 3

The Government Accountability Office (GAO)

Question 4

True or False.

A recipient expending more than $10 million per year in federal awards must have a cognizant agency for audit.

Answer 4

FALSE.

A recipient expending more than $50 million per year in federal awards must have a cognizant agency for audit.

i.e. The designated agency is the federal awarding agency that provides the predominant amount of direct funding

Question 5

What would be considered a reporting requirement for governmental financial audits?

Answer 5

Auditors should externally report significant deficiencies and material weaknesses in internal control.