Audit Changes for June 2007 Audits (Revisited!)
School Advisor, 2007 Issue No. 1  

Yes, we know we told you about SAS No.103, Audit Documentation, and SAS No. 112, Communication of Internal Control-Related Matters Noted in an Audit, in our last issue, but we intend to keep reminding you of these significant changes for this year’s audit.

SAS No. 103 will mean increased workpaper documentation (which means more questions from us and more requests for supporting documents) and, more importantly, a change in our report date. Historically our opinion was dated the last date of fieldwork. Now it must be dated when the financial statement is completed, reviewed, and ready for processing. Any significant delay (as in waiting for MD&A, fixed assets, attorney confirmations, etc.) will result in the need for us to come back out to the district and perform additional subsequent events procedures. Planning for an efficient audit that results in a complete package will be very critical to holding down audit fees and making all of our lives easier.

SAS No. 112 lowers the threshold for reporting internal control deficiencies, which means it is likely there will be more items noted during the audit that will require reporting. This may result in districts that were previously classified as “low-risk auditees” for single audit purposed losing that designation for future years.

So we hope you can appreciate it will be anything but business as usual this year, and next year (June 2008) will see many more major audit changes!