GAO Invites Comments on Revised Yellow Book
GAO has released the 2010 draft revisions to Government Auditing Standards (the Yellow Book). Comments on the proposed changes are due Nov. 22, 2010.
The revisions consolidate many of the current Yellow Book chapters, and amend language and requirements to align with AICPA standards. But one of the most significant changes is a shift in the Yellow Book approach to auditor independence. Rather than establishing a specific list of “do’s” and “don’ts”, GAO is proposing a “conceptual framework” for making independence determinations based on each situation’s unique facts and circumstances.
Auditors would identify potential risks to independence, evaluate the significance of those threats, and apply safeguards to eliminate the risks if necessary. The independence section also identifies six specific nonaudit services that would impair auditor independence in the government environment.
The draft Yellow Book is only available in online PDF format. Click here to view the draft and for instructions on submitting comments.