Study of Progress Made in Implementing the Single Audit Concept

A report was presented on a recent GAO study in 10 States of the implementation of Office of Management and Budget (OMB) Circular A-102, Attachment P, which was issued in an effort to implement the single audit concept in the auditing of grants to states and local governments.

GAO found that neither the circular nor related policies have clearly defined the single audit concept. OMB has assigned various cognizant agencies to oversee the implementation of the circular at the state and local levels. For a limited number of state and local governments, OMB assigned a lead cognizant agency to coordinate the single audit on behalf of other cognizant agencies. With the lack of a clear definition and common agreement on the scope of the audit and a diffusion of responsibility in the current cognizant agency system, the transition to the single audit has been slow and difficult. Relatively few audits that were completed, in process, or planned pertained to local governments; since most federal grant funds are spent by local governments in the 10 States studied, the funds were not audited in accordance with the OMB requirements. GAO found a wide diversity in the sampling methods auditors used for selecting federal grants at the local level. The study found that the cognizant agency system in most states did not: (1) designate a lead or single federal agency to be responsible for coordination of the single audit within a state; (2) facilitate the development of a plan for implementing the single audit at federal, state, and local levels of government; (3) provide uniformity within a state on the technical aspects of the audit; or (4) help develop a plan to monitor the audits performed.

Recommendations

Our recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.

Director: John J. Adair Team: General Accounting Office: Accounting and Financial Management Division Phone: (202) 272-3060