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Published 1 (2022-08-26)

handle is hein.gao/gaonng0001 and id is 1 raw text is: U.S. GOVERNMENT ACCOUNTABILITY OFFICE 441 G St. N.W. Washington, DC 20548 August 26, 2022 Ms. Toni Lee-Andrews Director, Professional Ethics Division American Institute of Certified Public Accountants 220 Leigh Farm Road Durham, NC 27707-8110 GAO's Response to the AICPA's Professional Ethics Executive Committee's Proposed New and Revised Definitions and Interpretations: Compliance Audits, June 2022 Dear Ms. Lee-Andrews: This letter provides GAO's comments on the exposure draft entitled Proposed New and Revised Definitions and Interpretations: Compliance Audits, which was prepared by the American Institute of Certified Public Accountants' (AICPA) Professional Ethics Executive Committee (PEEC). GAO establishes standards for performing high-quality audits of government organizations, programs, activities, and functions and of government assistance received by contractors, nonprofit organizations, and other nongovernment organizations with competence, integrity, objectivity, and independence.1 Our standards, often referred to as generally accepted government auditing standards (GAGAS), are to be followed by auditors and audit organizations when required by law, regulation, agreement, contract, or policy. For financial audits and attestation engagements, GAGAS incorporates by reference the AICPA's Statements on Auditing Standards. When conducting GAGAS engagements, GAGAS has independence requirements and a GAGAS Conceptual Framework Approach to Independence for auditors to identify threats to independence, evaluate the significance of the threats identified, both individually and in the aggregate; and apply safeguards as necessary to eliminate the threats or reduce them to an acceptable level. GAGAS is the authoritative source of independence requirements for GAGAS engagements. The AICPA Code of Professional Conduct (the Code) is the authoritative source of AICPA independence requirements. For independent public accountants conducting attest engagements under the Statements of Auditing Standards, when an attest engagement is subject to GAGAS, the auditor must comply with the GAGAS independence requirements as well as the Code. The subject matter of this exposure draft predominantly relates to audits that are subject to GAGAS. In our view, the proposed changes are not sufficiently clear. These proposed changes may not produce appropriate and consistent responses by auditors. We are concerned with the potential 'GAO, Government Auditing Standards: 2018 Revision Technical Update April 2021, GAO-21-368G (Washington, D.C.: April 2021). Page 1

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