Wiley Practitioner's Guide to GAAS 2018, 2nd Edition

AU-C 935 Compliance Audits

AU-C Original Pronouncements

Sources

Statements on Auditing Standards (SASs) 117, 122, 123, 125, and 130.

AU-C 935 Definitions of Terms

Source: AU-C 935.11

1. Applicable compliance requirements. Compliance requirements that are subject to the compliance audit.
2. Audit findings. The matters that are required to be reported by the auditor in accordance with the governmental audit requirement.
3. Audit risk of noncompliance. The risk that the auditor expresses an inappropriate audit opinion on the entity's compliance when material noncompliance exists. Audit risk of noncompliance is a function of the risks of material noncompliance and detection risk of noncompliance.
4. Compliance audit. A program-specific audit or an organization-wide audit of an entity's compliance with applicable compliance requirements.
5. Compliance requirements. Laws, regulations, rules, and provisions of contracts or grant agreements applicable to government programs with which the entity is required to comply.
6. Deficiency in internal control over compliance. A deficiency in internal control over compliance exists when the design or operation of a control over compliance does not allow management or employees, in the normal course of performing their assigned functions, to prevent, or detect and correct, noncompliance on a timely basis. A deficiency in design exists when (1) a control necessary to meet the control objective is missing, or (2) an existing control is not properly designed ...