Best Practices - Auditing

Question 1

What are the three main groups responsible for the quality of financial reporting?

Answer 1

Governing body, financial management, and the independent auditor

Question 2

What is an audit committee?

Answer 2

The practical means for a governing body to provide much needed review and oversight of the government’s financial reporting process, internal controls, and independent auditors.

Question 3

How often should an audit committee review its establishing documentation?

Answer 3

Every 5 years.

Question 4

What is the fewest number of audit committee members?

Answer 4

3

Question 5

What does GFOA suggest the independent audit cover?

A. basic financial statements
B. (A) + individual funds
C. (B) + component units
D. none of the above.

Answer 5

C

Question 6

Does GFOA recommend audits be completed by audit standards of:

A. GAGAS
B. GAAS
C. GASB

Answer 6

A - the highest level of assurance

Question 7

Is it better for a government to contract with independent auditors for a single year or multiple years?

Answer 7

Multiple

Question 8

A ______ is any audit professional who works directly for management, at some level, and whose primary responsibility is helping management to fulfill its oversight and internal control duties as effectively and efficiently as possible.

A. audit committee
B. finance professional
C. independent auditor
D. internal auditor

Answer 8

D

Question 9

It is recommended that internal auditors possess a _____ degree and is highly desirable they hold some appropriate form of professional certification.

Answer 9

College

Question 10

Describe a group audit.

Answer 10

When one government incorporates financial statements an entity that is separately audited.

Question 11

What is the most important part of a group audit.

Answer 11

To ensure adequate communication between the auditors of the multiple units.