Government Audit Services and Yellow Book CPAs

Government audits have a fixed deadline, a public audience, and a statutory authority looking over the auditor's shoulder.

The report goes to a governing body in an open meeting. The state auditor may review the work. The deadline is set by statute rather than by preference. And the standards involved, Government Auditing Standards layered over GASB reporting with a single audit frequently on top, are ones a firm either works in constantly or does not know well.

We audit cities, counties, special service districts, territories, public authorities, charter schools, public infrastructure districts (PIDs), infrastructure financing districts (IFDs), and municipal entities. We work year-round with over 50 government entities with a staff of highly trained CPAs and professionals who specialize in government audit procedures. We also work with many types of government organizations and territories and their component entities. We’ve been working with state and local governments since our firm’s inception, over 50 years ago. Our clients appreciate our insight and expertise regarding the safeguarding of their public funds.

Request a proposal or RFP response

What a government audit involves

Government Auditing Standards. The Yellow Book adds requirements beyond generally accepted auditing standards, including heightened independence evaluation, continuing education specific to government auditing, and reporting on internal control and compliance. Independence is where firms most often create problems for themselves, because assisting with financial statement preparation for an audit client requires evaluation and documentation of the resulting threat.

GASB reporting. Government financial statements follow their own model: government wide and fund level presentation, modified accrual for governmental funds, and the reconciliation between them. Recent standards on leases, subscription based technology arrangements, and other areas have required implementation work for entities that had not previously reported those items.

Single audit. Where federal spending exceeds the applicable threshold, compliance testing on major programs is added, covering allowable costs, eligibility, procurement, subrecipient monitoring, and reporting.

State requirements. Utah entities file with the state auditor under a defined schedule and format, and other states have their own. We work within the requirements of the jurisdictions where our clients sit.

The deadline problem, and how we handle it

Almost every government entity we serve has a June 30 year end. The reports come due in the same window. Firms that take on more government work than they can staff end up late, and a late filing is a public failure for the entity, not for the firm.

We plan our government workload a year ahead so every engagement gets full attention during year-round fieldwork. We have a fully trained staff dedicated to government audit work that works with you to ensure your deadlines are met in a timely manner. If we cannot commit to your deadline, we say so during the proposal stage rather than accepting the work and explaining later.

That planning is why our government clients get their reports filed on time, year after year.

Responding to RFPs

Most government engagements are procured through a formal process, and we respond to RFPs regularly.

We can provide the standard components: firm qualifications, government sector experience and client references, engagement team resumes with Yellow Book continuing education documentation, peer review report, evidence of independence, proposed timeline against your statutory deadline, and a fee proposal in the required format.

Send us the RFP and the deadline.

Working with elected officials and the public

An audit report presented to a council or board is a different communication than a report delivered to a business’ management team.

We present findings in plain language, we distinguish clearly between a material weakness and a minor recommendation, and we answer questions from members directly. We also make ourselves available before the meeting to walk the finance director and the administrator through anything that will require explanation, so nobody is surprised in public.

Beyond the audit

GASB implementation support. For new standards, provided within independence limits.

Agreed upon procedures. For targeted questions such as grant close out, impact fee compliance, or a specific fund.

Fraud risk assessment and forensic investigation. Public entities face particular exposure in cash handling, procurement, and payroll. Our team includes Certified Fraud Examiners.

Internal control design and remediation. For entities addressing prior findings, subject to the independence evaluation the Yellow Book requires.

WHAT KIND OF EXPERIENCE SHOULD CPA FIRMS HAVE TO SPECIALIZE IN AUDITS FOR GOVERNMENT ENTITIES?

CPA firms that specialize in government audits have dedicated public sector practices with experience serving cities, counties, school districts, and special districts. These firms understand governmental accounting, fund accounting, and compliance requirements under GASB, GAO, and Uniform Guidance standards. A qualified CPA firm working with municipalities or government entities should have experience with government accounting standards, public sector compliance requirements, Single Audits, and working with governing boards and oversight agencies. Industry-specific knowledge helps audits run more efficiently and effectively.

WHAT IS INCLUDED IN A GOVERNMENT FINANCIAL STATEMENT AUDIT?

A government financial statement audit typically includes testing of internal controls, evaluation of compliance with laws and regulations, verification of fund balances, and issuance of an independent auditor’s report. The audit helps ensure accountability and financial integrity for public resources.

CAN A CPA FIRM HELP WITH SINGLE AUDITS AND FEDERAL GRANT COMPLIANCE?

Yes. Many CPA firms provide Single Audit services for government entities that expend federal funds, including testing compliance with Uniform Guidance requirements and federal grant programs to help reduce the risk of audit findings and questioned costs.

HOW OFTEN ARE GOVERNMENT ENTITIES REQUIRED TO HAVE AN EXTERNAL AUDIT?

Most government entities are required to have an annual external audit, depending on state laws, grant requirements, and governing regulations. Annual audits help ensure ongoing compliance, transparency, and fiscal responsibility.

CAN A CPA FIRM ASSIST WITH INTERNAL CONTROL REVIEWS FOR GOVERNMENT ORGANIZATIONS?

Yes. CPA firms often assist government entities with evaluating and improving internal controls, identifying risks, and strengthening financial processes to help prevent errors, fraud, and compliance issues.

DO CPA FIRMS OFFER ACCOUNTING AND ADVISORY SERVICES BEYOND THE ANNUAL AUDIT FOR GOVERNMENTS?

Many CPA firms provide year-round accounting, advisory, and consulting services for government entities, including financial reporting assistance, accounting system support, budgeting guidance, and technical accounting consultations.

Government Services