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Friday, September 08, 2006

GAO to OMB: Go slow on stricter audit requirements

"The Government Accountability Office recently urged the Office of Management and Budget to step up federal audit requirements slowly, to allow agencies time to first reach stricter standards that went into effect in June.

In a Tuesday letter to leaders of the Senate Homeland Security and Governmental Affairs and the House Government Reform committees, McCoy Williams, GAO's director of financial management and assurance, presented the agency's analysis of a recent cost-benefit study conducted by the Chief Financial Officers Council and the President's Council on Integrity and Efficiency, an association of presidentially appointed inspectors general.

The study and GAO's analysis, which were called for under the 2004 Department of Homeland Security Financial Accountability Act, address how and when agencies should be required to obtain an audit opinion on their internal controls over financial reporting. Under the rules of OMB's Circular A-123, the teeth of which were first felt by agencies in June, managers at the 24 CFO Act agencies must provide annual assurances on the accuracy and effectiveness of their internal controls for financial reporting.

Although most agencies are not required to obtain formal internal control audits, DHS must do so starting this year under the 2004 financial accountability law."

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