In the Federal assistance (commonly known as assurance to the US federal government as to the management and use of such funds by different recipients, such as States, cities, universities, and compliance components. The Single Audits must be submitted to the Federal Audit Clearinghouse along with a data collection form, Form SF-SAC.

==History==
Prior to the implementation of the Single Audit, the federal government relied on numerous audits carried out on individual federally funded programs used by recipients to ensure that these funds were expended properly. Because the government had numerous agencies awarding hundreds of different programs, the task of auditing all programs became increasingly difficult and time consuming. In an effort to improve this situation, the Single Audit Act of 1984 was enacted to standardized the requirements for audits of States, local governments, and Indian tribal governments that receive and use federal financial assistance programs.<ref name="OMB_intro"> OMB Circular A-133: Compliance Supplement; Part I: Background, Purpose and Applicability; Background; pg. 1-1, par. 1 through 4 and pg. 1-2, par. 1 through 2</ref>  

In 1985, the United States Office of Management and Budget (OMB) issued OMB Circular A-128, “Audits of State and Local Governments,” to provide guidance to recipients and auditors for implementing and carrying out the new Single Audit. In 1990, OMB administratively extended the Single Audit process to non-profit organizations by issuing OMB Circular A-133, “Audits of Institutions of Higher Education and Other Non-Profit Organizations” which superseded OMB A-128.  With these new guides and provisions, the Single Audit was standardized in the United States to include any and all States, local governments, and non-profit organizations and institutions that receive federal funds from the US government.<ref name="OMB_intro"/><ref name="a133_200(1)">OMB Circular A-133 Title 1 - ''Purpose''</ref><ref name="a133_200">OMB Circular A-133 Subpart A - ''General''; §___.100 - ''Purpose''</ref>

==Purpose and components==
The federal government provides an extensive array of federal assistance to recipients reaching over $400 billion dollars annually.<ref name="OFFM"/> This assistance is provided through thousands of individual grants and awards annually for the purpose of benefiting the general public in the areas of education, health, public safety, welfare, and public works, among others. However, as a condition of receiving this assistance recipients must comply with applicable federal and state laws and regulations, as well as any particular provisions tied with the specific assistance.<ref name="OMB_intro3"> OMB Circular A-133: Compliance Supplement; Part I: Background, Purpose and Applicability; Overview of this Supplement; Internal Control; pg. 1-6, par. 5</ref> The Single Audit provides the Federal government with assurance that these recipients comply with such directives by having an independent external source (the CPA) report on such compliance. However, it only applies to state & local government and nonprofit recipients that expend $500,000 or more of such assistance in one year.[http://www.whitehouse.gov/OMB/financial/fin_single_audit.html][http://www.aicpa.org/audcommctr/toolkitsnpo/Single_Audit_Act.htm]

A Single Audit encompasses the examination of a recipient’s financial records, financial statements, federal award transactions and expenditures, the general management of its operations, the systems of internal control, and the federal assistance itself received during the audit period (the time period of recipient operations which will be examined in the Single Audit, which is usually covers a natural or fiscal year).<ref name="a133_500">OMB Circular A-133; Subpart E - ''Auditors''; §___.500 - ''Scope of Audit''</ref><ref name="Flood"/> The Single Audit is divided into two areas: Compliance and Financial.

The compliance component of a Single Audit covers the study and understanding (planning stage) as well as the testing and evaluation (exam stage) of the recipient with respect to federal assistance usage, operations and compliance with laws and regulations.<ref name="a133_500"/> The financial component is exactly like a financial audit of a non-federal entity which includes the audit of the financial statements and accompanying notes. Depending on the recipient, the Single Audit can be simple and straightforward, or it could be complex and troublesome. This is due to the fact that there are millions of federal grants awarded each year to thousands of recipients, each with its own independent way of operating. Therefore, the Single Audit differs from recipient to recipient and from federal program to program.

For these reasons, the federal government requires auditors to perform the compliance audit of a recipient with a planning stage and an exam stage. During the first stage, or planning stage, the auditor must study the recipient, determine whether there is a high or low risk that the recipient does not comply with laws and regulations, identify federal programs, and evaluate such programs. The second stage, or exam or audit stage, is where the auditor actually audits the federal assistance and programs.<ref name="a133_500"/>  The planning stage is considered an integral part of the Single Audit because it allows the auditor to design and perform the audit based on the qualities, characteristics and needs of the recipient to be audited.

==Compliance audit: planning stage==
===Low-risk or High-risk auditee===
Before determining which federal programs the auditor will examine, the auditor must first study the recipient itself. This evaluation requires the auditor to interview its employees, observe the recipient in operations, obtain third-party references, and read the recipient’s prior audit reports, among other procedures, in order to understand the recipient and to determine whether it is likely that it complies or doesn’t comply with federal laws and regulations. This is performed because the recipient’s operations, procedures, and work ethic directly affects the compliance of individual federal programs with laws and regulations.

The evaluation concludes with the auditor determining, based on the evaluation, whether the recipient is a '''high-risk''' auditee or a '''low-risk''' auditee. A high-risk auditee is a recipient which has a high risk of not complying with federal laws and regulations, while a low-risk auditee is the exact opposite. For example, an auditor may judge a recipient to be a high-risk auditee because the audit reports of the past few years have numerous '''audit findings''' (e.g. specific situations of non-compliance with laws and regulations, serious deficiencies in internal controls and/or acts of fraud), or because the auditor receives news from various sources that the recipient is engaged in illegal activities, such as money laundering. On the other hand, the auditor may determine that a recipient is low-risk because its management personnel have a good work ethic, the auditor has received good references from external sources, or because the recipient has never received any audit findings. However, the OMB Circular A-133 has set certain requirements a recipient must meet in order to be considered a low-risk recipient, which includes the following:<ref name="a133_530">OMB Circular A-133; Subpart E - ''Auditors''; §___.530 - ''Criteria for a low-risk auditee''</ref>

* Single audits have been performed on an annual basis in prior years.
* The auditor's opinions on the financial statements and the Schedule of Federal Expenditures (discussed later) were unqualified (financial statements are reasonably correct).
* There are no significant deficiencies in internal control (also known as material weaknesses in internal controls) identified in prior year audits.
* None of the Federal programs previously audited had audit findings in the last two years.

The OMB Circular A-133 uses the high and low risk determination in order to regulate the amount of auditing to be performed. Although the actual work necessary for a Single Audit is established by the auditor, the OMB has set a limit for auditing high-risk and low-risk recipients. For high-risk recipients, the auditor is required to audit not less than 50% of all the federal assistance received during the year. For low-risk recipients, that limit is decreased to 25%.<ref name="a133_520f">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (f) – ''Percentage of coverage rule''</ref>

This determination also affects the entire Single Audit because the auditor will adjust the examination accordingly. Since the auditor must provide an opinion to the federal government on whether the recipient and its programs complied with laws and regulations, the auditor will perform sufficient tests and audit procedures (also known as audit work) in order to satisfy his/herself that the opinion is correct.<ref name="a133_500d4">OMB A-133; Subpart E - ''Auditors''; §___.500 – ''Scope of audit''; section (d)(4) - ''Compliance''</ref> Normally, the auditor will greatly increase the amount of audit work for high-risk auditees to assure that his/her opinion is correct. For low-risk auditees, the auditor will not be as rigorous as with a high-risk; but nevertheless must be aware that not because a recipient is low-risk does it mean that it is fully complying with all laws and regulations (consequently, a high-risk determination does not necessarily mean that the recipient never complies with laws and regulations either, just that it is more likely than not).

===Identification of federal assistance programs===
In order to determine which federal programs will be audited under the compliance audit, federal assistance expended by the recipient (also called '''federal expenditures''') during one year is identified by federal program name, Federal agency and CFDA number. These federal expenditures are then combined to determine the total amount expended during the year. Any recipient whose total federal expenditures during a year equal or exceed $500,000 requires a Single Audit[http://www.whitehouse.gov/OMB/financial/fin_single_audit.html][http://www.aicpa.org/audcommctr/toolkitsnpo/Single_Audit_Act.htm]. If the recipient does not meet this threshold, a Single Audit is not required, although the recipient may elect to have a program-specific audit (an audit of a single federal program, without auditing the entire entity). Once this determination is performed, OMB Circular A-133 requires that federal programs by categorized in two groups: Type A programs and Type B programs.<ref name="a133_520b">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (b) – ''Step 1''</ref>

* '''Type A program''' – a Type A program is any federal program within a recipient which expends either: (1) $300,000 or more of federal assistance for recipients with $10 million or less of expended federal assistance during the audit period, or (2) 3% of the total federal assistance expended during the year for those who exceed $10 million, whichever is greater. In other words, if a recipient expended a total of $10 million or less in federal assistance, then any single program which expended $300,000 or more is considered a Type A. If a recipient expended more than $10 million in federal assistance, then any single program which expended 3% of that amount is considered a Type A program.<ref name="a133_520b1">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (b)(1)</ref>

* '''Type B program''' – A Type B program is any single program which does not meet the Type A requirements.<ref name="a133_520b2">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (b)(2)</ref>

:Example 1 – The City of Example operates a Section 8 program, and expended $450,000 in Section 8 funds and $5,000,000 of total federal assistance during the year. Since this amount does not exceed $10,000,000, the Section 8 program is considered a Type A program because $450,000 exceeds the $300,000 threshold. 

:Example 2 – Using the same data in Example 1 with the exception that the City of Example now expended a total of $15,000,000 in federal assistance, the Section 8 program would meet the Type A threshold because $450,000 is equal to $15,000,000 x 3% ($450,000).

:Example 3 – Using the same data in Example 1 with the exception that the City of Example now expended a total of $20,000,000 in federal assistance, the Section 8 program would not meet the Type A threshold because $450,000 is less than $20,000,000 x 3% ($600,000), and would be considered a Type B program.

===Risk assessment===

After determining which programs are Type A and Type B, the OMB Circular A-133 requires that the auditor study and understand the operations and internal controls of such programs within the entity, and perform<ref name="a133_520c">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (c) – ''Step 2''</ref> and document<ref name="a133_520g">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (g) – ''Documentation of risk''</ref> a risk assessment based on such study to determine whether each program has either a high or low risk of not complying with laws and regulations. Auditor may consider numerous factors including current and prior audit experience, good or poor internal controls over Federal programs, many or no prior audit findings, continuous or lack of oversight exercised by the federal government over the recipient, evidence or knowledge of fraud, and the inherent risk of the Federal program.<ref name="a133_525">OMB Circular A-133; Subpart E - ''Auditors''; §___.525 - ''Criteria for Federal program risk''</ref>

For any Type A program which are considered to be a high risk of not complying, the OMB Circular A-133 requires that the auditor to perform a compliance audit on that program.<ref name="a133_520e">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (e) – ''Step 4''</ref> For a Type A program that is considered to be of low risk, then the auditor is not required to perform a compliance audit, although the OMB Circular A-133 allows the auditor to do so if he/she chooses to.<ref name="a133_520e"/> Although the risk assessment is performed by the auditor based on his/her judgment,<ref name="a133_520h">OMB Circular A-133; Subpart E - ''Auditors''; §___.520 - ''Major program determination''; section (h) – ''Auditor’s judgment''</ref><ref name="a133_525"/> the OMB Circular A-133 does have two requirements for a program to be considered low risk. First, the program must have been audited at least once in the last two years, and second, the program must have no audit findings when it was last audited. If the program does not comply with either of these two requirements, it is automatically considered as high risk.<ref name="a133_520c"/>

For the smaller Type B programs which have been identified as high-risk, the auditor has two options: either audit half of all high-risk Type B programs, or audit one Type B high-risk program for every low-risk Type A program.<ref name="a133_520e"/> Type B programs which have a low risk of not complying are not required to be audited.

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Das '''Government Accountability Office''' (kurz '''GAO''') ist ein unparteiisches Untersuchungsorgan des Kongresses der Vereinigten Staaten. In seinen Aufgaben ähnelt es dem deutschen Bundesgesetz vom 10. Juni 1921<ref>Public Law 67-13, 42 Stat. 20-27</ref> geschaffen mit dem Ziel, „alle Ereignisse in Verbindung mit dem Erhalt, der Verteilung und der Benutzung von Steuergeldern“ zu untersuchen und dem Kongress sowie dem Präsidenten „Bericht zu erstatten, mit Vorschlägen, wie öffentliche Ausgaben effizienter oder kostengünstiger durchgeführt werden können“<ref>Para. 312 (a), 42 Stat. 25-26</ref>. Von der Schaffung des GAO bis 2004 stand das Akronym für '''Government Accounting Office''' (dt. ''Regierungsrechnungsbehörde''). Die Umbenennung erfolgte am 7. Juli 2004  mit der Verabschiedung des ''GAO Human Capital Reform Act''. Entsprechend dem Leitspruch des GAO existiert die Behörde dazu, dem Kongress in seinen verfassungsgegebenen Pflichten zu unterstützen und die Verantwortung der Regierung gegenüber dem amerikanischen Volk zu sichern.

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Seit der Ernennung durch Präsident Bill Clinton 1998 leitet David M. Walker, vormals Partner bei der ehemaligen Wirtschatsprüfungsfirma Arthur Andersen und Amtsträger im Arbeitsministerium unter den Präsidenten Ronald Reagan und George W. Bush, als siebter Comptroller das GAO.

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