August 30, 1999
MEMORANDUM FOR INSPECTORS GENERAL AND CHIEF FINANCIAL OFFICERS OF EXECUTIVE DEPARTMENTS AND AGENCIES
|FROM:||Sheila O. Conley, Acting Deputy Controller /s/|
|SUBJECT:||Impact of Y2K on Audits of Federal Awards Under OMB Circular A-133|
The purpose of this memorandum is to:
Impact of GASB Technical Bulletin 98-1 on Single Audits
would not preclude an entity from qualifying as a low-risk auditee under paragraph ___.530 of OMB Circular A-133. Accordingly, auditees with qualified or adverse opinions resulting solely from the limited circumstances described in the preceding sentence do not need to request separate waivers from their Federal cognizant or oversight agencies for audit. However, for opinion modifications or disclaimers of opinion for any other reason, auditees must obtain waivers from their Federal cognizant or oversight agencies for audit to be considered a low-risk auditee under paragraph ___.530 of OMB Circular A-133.
Procedures for Submitting Revised Financial Statements
Auditor Consideration of the Y2K Issue Under Single Audit
Procedures for Submitting an Amended Reporting Package
Due to Y2K Disclosures(1)
1. Prepare amended reporting package. The amended reporting package should only include the revised financial statements and reissued auditor's report on the revised financial statements.
2. Mark contents of amended reporting package: "REVISED DUE TO Y2K DISCLOSURES"
3. Prepare a transmittal letter. The transmittal letter should accompany the amended reporting package, in lieu of preparing a revised data collection form, and include the following:
4. Submit one copy of the amended reporting package and transmittal letter to the Federal Audit Clearinghouse.(3) Amended reporting packages, along with accompanying transmittal letters, should be addressed as follows:
5. A subrecipient should determine whether an amended reporting package should be submitted to its pass-through entities. Subrecipients required to submit a reporting package to pass-through entities under paragraph ___.320(e) of OMB Circular A-133 should also submit an amended reporting package to those same pass-through entities, unless otherwise informed by such pass-through entities.
(2) For example, "As permitted by GASB TB 99-1, ABC Government revised its financial statements as of and for the period ended June 30, 1998. Required disclosures about the Year 2000 are presented as required supplementary information in the revised financial statements, whereas such disclosures were previously presented in the notes to the financial statements. As a result, the auditor's report on the revised financial statements is unqualified, whereas a qualified opinion was rendered on the previously-issued financial statements."
(3) It is not necessary to submit to the Clearinghouse additional report copies for Federal awarding agencies. The Clearinghouse will retain one archival copy of the amended OMB Circular A-133 reporting package and transmittal letter. However, if specifically requested by a Federal awarding agency, an auditee should provide additional copies directly to the Federal agency.