Financial Audit Reports
Our two main financial audits are mandated by State and/or federal laws. They are:
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State of Michigan Annual Comprehensive Financial Report Audit
Statewide Single Audit
We develop our audit plan using an approach based on assessments of risk and opportunities for improvement.
We focus audit efforts on the activities identified through a preliminary survey that we believe have the greatest probability for needing improvement and/or the most significant consequences if proper execution does not occur.
Auditing identifies where and how improvements can be made; therefore, audit reports are written on an exception basis. Stated another way, we typically do not continue audits if the program appears to function as intended; our resources are more impact-driven if we focus on areas for improvement.
We focus audit efforts on the activities identified through a preliminary survey that we believe have the greatest probability for needing improvement and/or the most significant consequences if proper execution does not occur.
Auditing identifies where and how improvements can be made; therefore, audit reports are written on an exception basis. Stated another way, we typically do not continue audits if the program appears to function as intended; our resources are more impact-driven if we focus on areas for improvement.
Generally, we conduct audits in three main phases:
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Planning
The planning phase sets the foundation for the audit and includes conducting a preliminary survey, brainstorming, conducting research, developing the audit scope and objectives, setting the audit’s time frame, and performing many other activities. In this phase, we will:
- Review organization structure.
- Review applicable State and federal laws.
- Research legislation impacting the audited program.
- Understand how the auditee strives to reach its mission, goals, policies, and procedures.
- Review agency-produced reports.
- Identify relevant criteria to audit against, such as best practices, benchmarks, and audits of similar entities and from other states.
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Audit Fieldwork
This phase begins the strategic audit activities. During fieldwork, we will:
- Interview agency personnel.
- Sample and analyze data.
- Issue surveys if applicable.
- Validate evidence.
- Determine materiality of potential findings.
- Communicate with the agency.
- Issue draft audit findings.
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Report Preparation
This is the final stage. At this time, we:
- Draft the preliminary report.
- Ensure compliance with auditing standards.
- Ensure compliance with internal quality standards.
- Provide the agency with draft report.
- Obtain the agency preliminary response.
- Meet with the agency to address its concerns.
- Finalize the report.
- Release the report.
Initial Response
In each report containing audit findings, we include an initial (i.e., preliminary) agency response in which the agency indicates if it agrees or disagrees with the recommendation(s) and how and when it plans to comply.
Corrective Action Plans
By State law, upon completion of an audit, the agency is required to submit its plan to comply with the recommendations to the State Budget Office, which reviews the plan for completeness and forwards it to us for informational purposes. We upload the plan to our Web site as an entry under the corresponding audit report.
In each report containing audit findings, we include an initial (i.e., preliminary) agency response in which the agency indicates if it agrees or disagrees with the recommendation(s) and how and when it plans to comply.
Corrective Action Plans
By State law, upon completion of an audit, the agency is required to submit its plan to comply with the recommendations to the State Budget Office, which reviews the plan for completeness and forwards it to us for informational purposes. We upload the plan to our Web site as an entry under the corresponding audit report.
Generally accepted auditing standards of the American Institute of Certified Public Accountants.
Government Auditing Standards issued by the Comptroller General of the United States.
The federal Single Audit Act Amendments of 1996 and implementing regulations.
Government Auditing Standards issued by the Comptroller General of the United States.
The federal Single Audit Act Amendments of 1996 and implementing regulations.
Yes, we are subject to a triennial peer review required by Government Auditing Standards. The peer review is performed by a six-person National State Auditors Association external quality control review team. We have received eleven consecutive unmodified “clean” opinions. This is the highest level of opinion.