Which of the following is one of the overarching principles in Government Auditing Standards related to auditors performing nonaudit work for clients?
Auditors should not provide training to clients.
Auditors should not provide routine advice to clients or serve on advisory committees.
Auditors should not audit their own work or provide nonaudit services in situations when the nonaudit services are significant to the audit subject matter.
Auditors should not propose adjusting and correction entries.
An auditor performing nonaudit work for a client may be in danger of violating the independence rules in Government Auditing Standards when he or she
Conducts a search and recommends a particular person for a management position for the client.
Provides advice on establishing or improving internal controls.
Provides the client with benchmarking information.
Answers technical questions for the client.
Which of the following kinds of information is not included within the scope of a financial statement audit of a state or local government?
Governmental activities financial information.
Management's discussion and analysis (MD&A).
Major funds financial information.
Business-type activities financial information.
Performance audits, as defined in the GAO's Governmental Auditing Standards
Provide a basis for an auditor's opinion as to whether the entity is acquiring, protecting, and using its resources economically and efficiently.
Provide assurance that operations are in compliance with all applicable laws and regulations that may have a material effect on the financial statements.
Provide assurance or conclusions based on an evaluation of evidence regarding program effectiveness, economy, and efficiency; internal control compliance, and prospective analyses.
Are always performed by the internal audit staff to assist the entity's independent auditor.
Which of the following would be considered Category (b) GAAP for state and local government auditees?
AICPA Practice Bulletins if specifically made applicable to state and local governments by the AICPA and cleared by the GASB.
GASB Technical Bulletins.
GASB Statements and Interpretations.
GASB Implementation Guides.
A common reason why a government might receive a "qualified opinion" from the external auditors is
A violation of generally accepted accounting principles that does not cause material misstatement of the financial statements.
A fund balance deficit in the General Fund.
Poor internal controls such that the accounting records could not be audited.
Liabilities exceed assets in the General Fund.
Attestation engagements include
Assessment of the extent to which entity programs met their objectives.
Reviews of interim financial information.
Services that provide various levels of assurance on such matters as internal control, compliance, MD&A presentation, and reliability of performance measures.
Examining whether the entity's financial statements fairly present in conformity with GAAP.
Which of the following best describes the relationship between generally accepted auditing standards (GAAS) and generally accepted government auditing standards (GAGAS)?
GAAS apply to independent CPA auditors; GAGAS apply to governmental auditors.
Audits conducted in conformity with GAGAS may also require the auditor to conform to GAAS.
Audits done in accordance with GAGAS must also be done in accordance with GAAS.
Audits of state and local governments always required that the audit be conducted in accordance with both GAAS and GAGAS.
Which of the following is not a required audit report for a single audit?
A report on the entity's compliance with laws and regulations.
A report on internal controls related to the financial statements and major programs.
A report on the entity's financial statements and conformity with GAAP.
A report from the cognizant agency on auditee compliance.
All of the following reports are included in the reporting package resulting from the single audit except
Financial statements and schedule of expenditures of federal awards.
Summary schedule of prior audit findings.
Report on efficiency and effectiveness.
Corrective action plan.
