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AICPA RISK ASSESSMENT GUIDANCE
Knowledge-Based AuditsTM of Governmental Entities Add-On Module
The Knowledge-Based Audit (KBA) methodology is designed to help the auditor efficiently and effectively perform financial statement audits of state and local governments, in accordance with auditing standards generally accepted in the United States of America (GAAS), and, when applicable, Government Auditing Standards (GAGAS).
Audits performed on financial statements of state and local governments are unique in that the audits may have as many as three sets of applicable audit standards or requirements. These include:
Generally Accepted Auditing Standards (GAAS);
Government Auditing Standards – July 2007 Revision (GAGAS); and
The Single Audit Act of 1996, as amended and OMB Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations (Single Audit or A-133).
The circumstances surrounding the applicability of the different sets of standards and requirements vary and involve a number of issues, including legal, regulatory, or contractual requirements, and the amount of federal awards expended by the nonfederal entity in the audit period. KBA of Governmental Entities provides an analysis of the applicability of GAAS, GAGAS and the Single Audit to an audit of a state or local government or non-profit organization’s financial statements and federal awards. GAAS, GAGAS, and the Single Audit requirements have an overlapping relationship. With this module, you have the benefit of over 175 practice aids to guide you through an audit.
This industry-specific guidance is based off our exclusive KBA methodology.
CCH's own KBA:
facilitates compliance with GAAS
encourages more efficient audits through customized audit programs
helps auditors to identify and focus on risks
The new Knowledge-Based Audit (KBA) methodology was developed by CCH. This updated methodology emphasizes understanding your clients and their environment so you can accurately assess the risks of material misstatements. The KBA method focuses on information flow rather than document flow, enhances communication between engagement team members, and allows for ongoing evaluation of procedures. Practitioners are able to make informed risk assessments using their own professional judgment and expertise.
Communications Hub Enhances Audit Approach
The Knowledge-Based Audit methodology utilizes a set of integrated procedures, from pre-engagement all the way through evaluating, concluding and reporting. The results from each audit stage feed into the Communication Hub, which enables audit team members to easily view summaries of the significant matters, risks and findings discovered in the audit. This design ensures that important information is not overlooked or hidden in the details of numerous checklists and forms.
This module is available for $249 as an add-on to our main ARM products or you can access this material as part of our ARM Governmental Library.
CCH KBA Available in Your Preferred Format
ProSystem fx® Engagement and KnowledgeTools
Experience complete interactivity with the KBA overview, tools and integration with the leading software solution. ProSystem fx® Engagement and KnowledgeTools provide you a complete and streamlined methodology, making it easier for you to comply to the risk assessment standards. Learn more about this unique offering.
Knowledge-Based Audits (KBA) publication
For practitioners that need access to a printed version of this content, CCH offers the KBA publication – allowing an inexpensive, portable method to learn how to comply to the risk assessment standards.
Learn more about Knowledge-Based Audits of Commercial Entities.
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