Annie’s audit firm has recently won the bidding for the audit of Big Spending, an organization supported by public funds provided from the federal government. Annie has never been involved in an audit of a government organization and is unfamiliar with the standards governing an audit of a government-related entity. The night before she is scheduled to begin the engagement, Annie decides to do her homework. First, she goes to the PCAOB Web site and searches for any relevant information. Since the PCAOB governs audits of publicly traded companies, she finds no guidance from the ASs and the AUs. Next, she searches on the AICPA Web site, but once again finds no guidance from the SASs. Since she has exhausted all of the resources she is aware of, she gives up.
Where can Annie find guidance on standards affecting the Big Spending audit? What are governmental auditing standards called? How do audits of government entities vary from those of for-profit entities? How do entities that receive funds from government grants fit in?