Lesson: Governmental Audits

This lesson delves into the concept of governmental audits and compares them to single audits. The differences between these two types of audits are clarified, noting that governmental audits are performed on governmental entities while single audits are performed on non-federal entities that receive and expend federal funding. The lesson highlights the objective of governmental audits and the corresponding standards, such as the Governmental Accounting Standards Board (GASB) and the Governmental Auditing Standards (GAS), which differ from those applied to normal corporate audits. It also explains the extended scope of governmental audits, which may include considerations of program results, compliance with laws and regulations, and economy and efficiency. The lesson concludes by emphasizing the differences in requirements with regard to independence, reporting on financial statements, and reporting on internal control in governmental audits as compared to non-governmental audits.