FYI - Requirements under GAGAS vs GAAS Additional reporting requirements regarding internal control—Government Auditing Standards require a written report on internal control in every financial audit under GAGAS. This includes commentary about the auditor's understanding of internal control for planning purposes and the assessment of control risk, as well as the scope of the auditor's testing of internal control. When the auditor communicates significant deficiencies, the auditor should also obtain a response from officials of the entity and include a copy of management's written response (or a summary of management's oral response) in the auditor's report. Government Auditing Standards require a written report on compliance with applicable laws and regulations. This report should distinguish between (a) general requirements that apply to all federal financial programs; and (b) specific requirements that apply to a particular program by a specific statutory (legislative) requirement. Government Auditing Standards also require the auditor to report any known instances of illegal acts that could result in criminal prosecution.

Single Audit Act of 1984, as Amended—The Single Audit Act is applicable to state and local governmental entities that have expenditures of federal assistance (grants) aggregating at least $750,000 in a given year. It imposes certain requirements on such entities and their auditors that go beyond GAAS and even GAGAS. 1. Efficiency—A single coordinated audit of the aggregate federal financial assistance provided to a state or local governmental entity (with emphasis on the entity's major programs) is intended to result in greater efficiency compared to the alternative, which would be having multiple audits of the entity conducted on a grant-by-grant basis. 2. Added requirements—A single coordinated audit of the aggregate federal financial assistance involves more than just a financial statement audit. Additional testing of internal control is required for major programs, and additional testing is also required for major programs regarding the entity's compliance with applicable laws, regulations, or other requirements applicable to major programs. 3. Multiple reports—The auditor should issue reports on (a) the fairness of the entity's financial statements (and schedule of expenditures of federal assistance); (b) internal control over financial reporting (with emphasis on major programs); and (c) compliance with applicable laws, regulations, and other requirements. If audit findings were identified, the auditor should also prepare a Schedule of Findings and Questioned Costs.