TRUE/FALSE (CHAPTER 16)

TRUE/FALSE (CHAPTER 16)1. A “cognizant agency” can be an employee of either a federal agency or an independent accounting firm.2. The Single Audit Act of 1984 was passed to eliminate the costly practice of requiring separate audits for each federal program in which an organization participated.3. Performance audits are sometimes referred to as “operational” audits.4. Performance audits must be conducted by independent auditors.5. To “attest” means to confirm that something is true, correct, or genuine.6. An auditor of any government or not-for-profit that receives federal monies must include a report on the entity’s internal control structure within their audit report or provide a cross-reference to that report.7. The AICPA originally established auditing standards for federal single audits.8. Newly installed computer programs are one indicator that a government’s participation in a federal program may be at high risk of noncompliance.9. GAO independence guidelines permit CPA firms to determine the estimated useful lives of their clients’ assets.10. Under GAO (GAGAS) standards, independent auditors must report all instances of fraud or illegal acts that they discover during the course of an audit.11. Regarding the single audit process, required supplemental information is considered to be within the scope of the audit.11. Per OMB Circular A-133, “questioned costs” are those that should not be reimbursed under a federal grant because they are in violation of laws of provisions pertaining to the grant.13. The Yellow Book is an informal term for the compendium of all AICPA audit standards.14. An audit of a government or not-for-profit under the Single Audit Act has two main components: an audit of the financial statements under general accepted auditing standards (GAAS) and an audit of federal financial awards.15. An attestation engagement might include examination of prospective or pro-forma financial statements.