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Resolving Audit Findings Policy

Authority:
General Statutes 143B-426.39 and 147-64.6
Single Audit Act of 1984

Effective Date:
7/1/95

Policy:
The Office of the State Auditor (OSA) completes an annual financial audit of the CAFR. The auditor's examination of the CAFR is conducted in accordance with generally accepted auditing standards (GAAS) and an opinion is included in the CAFR. In addition, the State presents the Single Audit Report of all federal financial assistance. The preparation of the report is coordinated through the OSA. The auditor's examination in regards to this report is conducted in accordance with generally accepted auditing standards and Government Auditing Standards (GAGAS) issued by the Controller General of the United States. The auditors opinion along with all state level audit findings are included in the Single Audit Report.

Each state agency and component unit (including community colleges and individual universities) must promptly evaluate all single audit findings, recommendations, and adjustments to account balances reported by either OSA, certified public accounting (CPA) firms, or federal representatives. The state agency or component unit determines proper actions in response to the findings and recommendations and corrects the matters brought to their attention within an established time frame. Copies of all auditor findings and recommendations, responses to auditor's findings, and any auditor adjustments are submitted to OSC for review.

Additional Information:
As a recipient of federal financial assistance, the State is responsible for ensuring that an adequate internal control structure is in place and that the State has complied with applicable laws and regulations. The internal control structure is subject to periodic evaluation by management and its internal audit staff, in addition to OSA.

OSC promptly evaluates CAFR audit findings and recommendations reported by OSA, determines proper actions in response to audit findings and recommendations, and corrects the matters brought to their attention within an established time frame. Responsible action is that which corrects identified deficiencies. Where audit findings identify opportunities for improvement rather than cite deficiencies, responsive action is that which produces improvements.

All auditor adjustments to account balances are classified as either CAFR or post-CAFR auditor adjustments. CAFR auditor adjustments are those adjustments submitted to OSC after NCAS accrual closing, but in time to be included in the CAFR. Post-CAFR auditor adjustments are those adjustments submitted to the fiscal unit after the cut-off date for inclusion in the CAFR for the preceding year. Post-CAFR auditor adjustments usually result in fund balance restatements. Materiality of auditor adjustments are based on criteria established by OSA or the CPA firm preparing the adjustments.