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NCJ Number: 66841 Find in a Library
Title: GRANT AUDITS - A NEW VISTA FOR CPAS (CERTIFIED PUBLIC ACCOUNTANTS)
Journal: JOURNAL OF ACCOUNTANCY  Volume:147  Issue:4  Dated:(APRIL 1979)  Pages:68-72
Author(s): E B STAATS
Date Published: 1979
Page Count: 5
Format: Article
Language: English
Country: United States of America
Annotation: PROBLEMS ENCOUNTERED IN AUDITS PERFORMED BY INDEPENDENT PUBLIC ACCOUNTANTS FOR FEDERAL GRANT PROGRAMS ARE EXAMINED ALONG WITH THE AUDITOR'S RESPONSIBILITIES AS PERCEIVED BY THE GENERAL ACCOUNTING OFFICE (GAO).
Abstract: STANDARDS FOR GOVERNMENT AUDITS ISSUED BY THE GAO IN 1972 MAINTAIN THAT AN AUDIT SHOULD ASSESS THE PROPER CONDUCT OF FINANCIAL OPERATIONS, COMPLIANCE WITH LAWS AND REGULATIONS, ECONOMY AND EFFICIENCY OF MANAGEMENT, AND PROGRAM RESULTS. CURRENTLY MOST INDEPENDENT ACCOUNTANTS PERFORM ONLY FINANCIAL AND COMPLIANCE AUDITS FOR GOVERNMENT AGENCIES, ALTHOUGH THEIR RESPONSIBILITIES SHOULD BE EXPANDED. A GAO REVIEW FOUND THAT ACCOUNTANTS GENERALLY CONDUCTED A SATISFACTORY FINANCIAL AUDIT, BUT OFTEN FAIL TO PROVIDE GOVERNMENT OFFICIALS WITH VITAL INFORMATION ON COMPLIANCE. AN EXAMINATION OF DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT (HUD) AUDITS SHOWED THAT THE HIGH RATE OF INADEQUATE COMPLIANCE REVIEWS WAS CAUSED BY UNCLEAR GUIDELINES FROM HUD, LACK OF ACCESS TO RELEVANT HANDBOOKS AND RECORDS, AND UNFAMILARITY WITH SPECIALIZED REQUIREMENTS OF A GOVERNMENT AUDIT. IN OTHER REVIEWS, GAO DISCOVERED WORK DONE BY ACCOUNTANTS THAT WAS BELOW PROFESSIONAL STANDARDS AND NOTED THAT WHILE ACCOUNTANTS WOULD REPORT SERIOUS DEFICIENCIES TO A GRANTEE, THEY WERE HESITANT TO REPORT THE PROBLEM TO THE GRANTOR AGENCY. ALTHOUGH IT IS DIFFICULT TO DETERMINE IF A GRANTEE MAY INCUR A LIABILITY FOR FAILURE TO MEET CERTAIN GRANT REQUIREMENTS, THE ACCOUNTANT SHOULD CONDUCT SOME VERIFICATION PROCEDURES TO TEST FOR COMPLIANCE. FEDERAL AGENCIES HAVE BEEN TRAINING PUBLIC ACCOUNTANTS IN THEIR AUDITING PROCEDURES, BUT THE AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS SHOULD INFORM ITS MEMBERS CONCERNING COMPLIANCE AUDITING AND CONDEMN THOSE AUDITORS WHO PERFORM SUBSTANDARD WORK FOR THE GOVERNMENT. THE EXISTENCE OF OVER 100 AUDIT GUIDES PREPARED BY INDIVIDUAL AGENCIES CONTRIBUTES TO CONFUSION ABOUT STANDARDS. GAO HAS PREPARED UNIFORM GUIDELINES WHICH APPLY TO FINANCIAL AUDITS OF ALL FEDERAL GRANT PROGRAMS THAT HOPEFULLY WILL BE ADOPTED BY AGENCIES. (MJM)
Index Term(s): American Institute of Certified Public Accountants (CPAs); Auditing standards; Audits; Federal programs; Grants or contracts; US Government Accountability Office (GAO)
Note: THIS ARTICLE IS AN ADAPTATION OF A SPEECH DELIVERED TO THE AICPA (AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS) NATIONAL CONFERENCE ON FEDERALLY ASSISTED PROGRAMS, NOVEMBER 8, 1977
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http://www.ncjrs.gov/App/publications/abstract.aspx?ID=66841

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