UNIFORM QUALITY CONTROL REVIEW

GUIDE FOR A-133 AUDITS

President’s Council on Integrity & Efficiency

1999 Edition
 INTRODUCTION

Objectives and Purpose

The objectives of a quality control review (QCR) of a single audit are to (1) ensure that the audit was
conducted in accordance with applicable standards and meets the single audit requirements, (2)
identify any follow-up audit work needed, and (3) identify issues that may require management
attention. The purpose of this document is to help ensure that the scope of the QCR is sufficient to
fulfill the review objectives, is consistent among cognizant agencies for audit, and provides support for
the results of the QCR.

Applicability and Use

This document is intended for use as a guide by all Federal agencies when conducting QCRs of A-133
audits. The reviewer must exercise professional judgment when completing the checklist provided in
this guide and reaching specific and overall conclusions on the quality of the audit.

If an agency wishes to adapt this document to fit into its overall non-Federal audit quality control
system, all checklist items should be included in the checklist that is developed. Agencies may
supplement this guide with additional items if desired. Because a QCR may not review all major
programs, judgment should be used in selecting the programs to be reviewed.

Description

The checklist is generally organized by audit standards and elements of an A-133 audit. The focus is
on the portions of the A-133 audit that are of most interest to Federal officials. A QCR includes an
initial review. QCRs performed with the use of this and the initial review checklists provide evidence
of the reliability of A-133 audits to auditors of Federal agency financial statements, such as those
required by the Chief Financial Officers (CFO) Act, and others.

All questions should be addressed; however, questions 11 and 12 are optional and need be answered
only when information concerning Federal program receivables and payables are required for selected
programs, such as Medicaid, for the Federal CFO audit. It is intended that this checklist serve as the
principal documentation to support the QCR. When a QCR shows that the audit meets all professional
standards and requirements of A-133, the checklist and A-133 report are sufficient to provide
reasonable coverage for Federal CFO audits at an individual auditee for the programs covered by the
QCR.

The questions in this checklist have been designed to indicate "Yes" or "N/A" (not applicable) answers
as favorable responses. All “No” (unfavorable) responses must be fully explained. It should be noted
that unfavorable responses identify situations that could be undesirable but do not necessarily imply
that the report is unacceptable. When deficiencies are noted, the checklist should be cross-referenced
to the auditor's working papers. Where appropriate, copies of the working papers should be obtained
to document deficiencies noted.

Uniform Quality Control Review Guide for A-133 Audits Page i

Attachment I of this guide, which is used in reviewing major programs, could be adapted for use in
Federal agency reviews of program-specific audits.

References

References are provided to enable the reviewer to refer to relevant requirements and standards. The
reviewer should be familiar with the requirements and standards and have them available when
performing the QCR. The reviewer should also be familiar with and have available the Office of
Management and Budget (OMB) Circular A-133 Compliance Supplement in effect for the period
audited. Below are the abbreviations used to reference the requirements and standards:

A-133 OMB Circular A-133, Audits of States, Local

Governments, and Non-Profit Organizations.

AU Codification of Statements on Auditing Standards,

promulgated by the American Institute of Certified Public Accountants
(AICPA).

GAS The financial audit standards contained in Government

Auditing Standards (1994 Revision), published by the General
Accounting Office (GAO).

SOP 98-3 American Institute of Certified Public Accountants (AICPA)

Statement of Position 98-3, Audits of States, Local Governments, and
Not-for-Profit Organizations Receiving Federal Awards.

SF-SAC Data Collection Form for Reporting on Audits of States, Local

Governments, and Non-Profit Organizations.

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 GENERAL INFORMATION

1. Auditee: _____________________________________________________________________

2. Audit Period: _________________________________________________________________

3. Auditor or Audit Organization (including location): ________________________________

_____________________________________________________________________________

_____________________________________________________________________________

4. Dates of Review: ______________________________________________________________

5. Review Team Members Organization

___________________________________ _____________________________________

___________________________________ _____________________________________

___________________________________ _____________________________________

___________________________________ _____________________________________

___________________________________ _____________________________________

___________________________________ _____________________________________

6. Basis of Selection: Random Judgmental

7. Contacts (Indicate personnel contacted): __________________________________________

______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________

______________________________________________________________________________

Uniform Quality Control Review Guide for A-133 Audits Page 1

 SUMMARY RESULTS OF QUALITY CONTROL REVIEW

Auditee:

Standards/Requirements Checklist Technically

Reference Acceptable Deficient Substandard
General Standards:

Auditor Qualifications 1 1

Independence 2-3

Due Professional Care 1 4

Quality Control 5-6

Fieldwork Standards:

Planning and Supervision 7 - 10

Federal Receivables and Payables 11 - 12

Other Standards Affecting Federal Awards 13 - 15

Single Audit Requirements:

Determination of Major Programs 16 - 22

Schedule of Expenditures of Federal 23 - 24

Awards

Audit Follow-Up 25

Reporting 26 - 29

Summary 30 - 34

Data Collection Form 35 - 37

OVERALL CONCLUSIONS
1. In my opinion, the audit is: (Note: The reviewer should consider the results from the initial review and

1 The overall results of the QCR should be considered in addition to the checklist items when assessing the
adequacy of the auditors' qualifications and the level of due professional care.

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 QCR in assessing the overall quality of the audit.)

[ ]Acceptable Contains no deficiencies or only minor deficiencies not requiring any

changes or corrective action for the current audit.

[ ]Technically Deficient Contains deficiencies requiring corrective action that do not appear to
affect the audit results.

[ ]Substandard Contains significant audit deficiencies that could potentially affect the
audit results, thus making the report unusable for fulfilling one or more
objectives of the audit.

2. Describe any issues that warrant follow-up audit work.

3. There are or are not program issues that should be brought to the attention of program
management. (Describe these issues.)

4. There are or are not issues that should be brought to the attention of program management
concerning needed changes to the Compliance Supplement. (Describe these issues.)

___________________/________________/__________
Reviewer Title Date

___________________/________________/__________
Reviewer Title Date

Review Item Yes No N/A Ref.

GENERAL STANDARDS

Auditor Qualifications

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 Review Item Yes No N/A Ref.

1. Did those responsible for planning, directing, conducting, and

reporting on the audit meet the GAS continuing professional
education requirements? (GAS 3.6) [Note: Reviewers may rely on
the results of the most recent external QCR (peer review) in
evaluating compliance with this requirement.]
Independence

2. Were the working papers free of indications that the auditor or audit
organization lacked independence? (GAS 3.11-.25; AU 220.01)
3. Are the audit organization’s peer review report and related letter of
comments (if any) free of any findings concerning a lack of
independence? If not, the reviewer should consider the relevant
problems indicated in the peer review. (GAS 3.18-.25)
Due Professional Care

4. Was the scope of the audit sufficient to meet the requirements of an

A-133 audit, and were all limitations, restrictions, or impairments to
the audit scope properly disclosed in the auditor’s report(s)?
(GAS 3.28; AU 508.22-.57; A-133.500)
Quality Control

5. Did the audit organization have a peer review within the last 3 years?
(GAS 3.33; SOP 98-3 3.12)

6. Did the results of the peer review indicate that the audit
organization’s internal quality control system was operating
effectively and that applicable auditing standards were being
followed? If not, the reviewer should consider the relevant problems
indicated in the peer review. (GAS 3.31, 3.33; SOP 98-3 3.12)

FIELDWORK STANDARDS

[Note: The reviewer may address questions in this section based solely on
the review of audit work performed for major programs and portions of the
financial statements reviewed.]

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 Review Item Yes No N/A Ref.
Planning and Supervision

7. Did the working papers (including the audit program) evidence that
the audit was adequately planned and supervised? (Note: Reviewers
may wish to answer this question after completing the review guide.)
(GAS 4.6-.11)
8. Did the auditor consider the effect of computer processing on the
nature, timing, and extent of auditing procedures, including the need
to assess the reliability of computer output? (AU 311.09)
9. If the auditor used the work of an internal auditor, were generally
accepted auditing standards (GAAS) followed? (AU 322.01-.29;
SOP 98-3 3.45)
10. If part of the audit was performed by other auditors, were GAAS
followed? (AU 543.01-.15; SOP 98-3 3.41, 3.44)

[Note: If the work done by the other auditor was significant with respect to
the Federal objectives of the single audit, a QCR of the other auditor's
working papers should be considered.]
[Note: Questions 11 and 12 are optional.]

Testing of Federal Program Receivables and

Payables in a Financial Statement Audit

11. When accounts receivable from the Federal Government are material
to the auditee’s financial statements:

a. Did the auditor perform procedures to gain an understanding of

internal control over accounts receivable from the Federal
Government, assess control risk, and document the understanding and
risk assessment? (GAS 4.21; AU 319.02 -.57; SOP 98-3 4.13)
b. Did the auditor's substantive testing provide sufficient, competent
evidence to provide reasonable assurance that accounts receivable
from the Federal Government reported in the financial statements
were fairly presented? (AU 312.25, 319.79-.82)

12. When accounts payable to the Federal Government are material to the
auditee’s financial statements:

a. Did the auditor perform procedures to gain an understanding of

internal control over accounts payable to the Federal Government,
assess control risk, and document the understanding and risk
assessment? (GAS 4.21; AU 319.02-.57; SOP 98-3 4.13)

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 Review Item Yes No N/A Ref.
b. Did the auditor's substantive testing provide sufficient, competent
evidence to provide reasonable assurance that the accounts payable to
the Federal Government reported in the financial statements were
fairly presented? (AU 312.25, 319.79-.82)
Other Standards Affecting Federal Awards

13. Were written management representations obtained concerning

Federal awards covering the following areas: [Note: Additional
representations may have been obtained by the auditor.] (SOP 98-3
6.68-.69)
a. Identification and completeness of the list of Federal award
programs?

b. Compliance with Federal requirements?

c. Identification of known instances of noncompliance?

14. Did the auditor perform the required audit procedures concerning
litigation, claims, and assessments? (AU 337.05-.09)
15. If evidence of possible fraud or illegal acts involving Federal funds
was found, did the auditor:
a. Attempt to obtain sufficient, competent evidence to determine
whether, in fact, material fraud or illegal acts occurred and, if so, their
effect on the financial statements and on other aspects of the audit?
(AU 316.35, 317.10-.16)

b. Report relevant information in accordance with the requirements of

GAS and A-133? (GAS 5.18-.25; A-133.510(a)(6))

c. Ensure that the auditee reported the matter to the entity that provided
the assistance? (GAS 5.23)

SINGLE AUDIT REQUIREMENTS

[Note: The reviewer may address questions in this section based solely on
the review of audit work performed for major programs and portions of the
financial statements reviewed.]
Determination of Major Programs

16. If the auditor did not use a risk-based approach to determining major

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 Review Item Yes No N/A Ref.
Federal programs, was this allowable and was the approach used
allowable? (A-133 .520(i); SOP 98-3 7.20)
17. If the auditee was considered a low-risk auditee, did the working
papers evidence that the auditor determined that the following
conditions were met for each of the preceding 2 years or, in the case
of biennial audits, the preceding two audit periods: (A-133 .530; SOP
98-3 7.25)
a. Annual single audits were performed on the entity covered by the
audit under review or, if a biennial audit, prior approval was obtained
from the cognizant or oversight agency? [Note: An entity does not
meet the criteria for a low-risk auditee if it was included in the single
audit of a different entity for either of the prior 2 years' audits.]
b. The auditor's opinions on the financial statements and the schedule of
expenditures of Federal awards were unqualified, or qualifications
were waived by the cognizant or oversight agency?

c. No deficiencies in internal control were identified as material

weaknesses under the requirements of GAS, or findings were waived
by the cognizant or oversight agency?
d. None of the Federal programs had audit findings from any of the
following in either of the preceding 2 years (or, in the case of biennial
audits, the preceding two audit periods) in which they were classified
as Type A programs:

(1) Internal control deficiencies that were identified as material

weaknesses?

(2) Noncompliance with the provisions of laws, regulations,

contracts, or grant agreements that have a material effect on the
Type A program?

(3) Known or likely questioned costs that exceed 5 percent of the

total Federal awards expended for a Type A program during the
year?

18. Did the auditor identify the larger Federal programs based on the
dollar thresholds identified in A-133 520(b) and label them as Type A
programs, with the remaining programs labeled as Type B? (A-133
.520; SOP 98-3 7.5-.6)
a. When identifying Type A programs, were loans or loan guarantees
that significantly affect the number or size of Type A programs
considered as Type A and their values excluded in determining other
Type A programs? (A-133 .520(b)(3); SOP 98-3 7.7)
19. Did the auditor perform and document risk assessment procedures on

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 Review Item Yes No N/A Ref.
each Type A program to identify those that are low risk? (A-133
.520(c)(1); SOP 98-3 7.10-.12)
20. Were all Type A programs that were identified as low-risk: (A-133
.520(c)(1); SOP 98-3 7.10-.12)
a.Audited as a major program in at least one of the two most recent audit
periods (in the most recent audit period in the case of a biennial audit)?

b.Free of audit findings under A-133 .510(a)(1), (2), and (5)?

c.Free of audit findings described in A-133 .510(a)(3), (4), (6), and (7),
or did the working papers document the basis for the auditor’s judgment that
such findings did not preclude a Type A program from being low risk?

d.Based on a documented risk assessment showing that the auditor

applied professional judgment and considered the criteria in A-133 .525(c),
.525(d)(1), (2), and (3), the results of audit follow-up, and any changes in
personnel or systems? (A-133 .520(c)(1))
21. Did the auditor consider the criteria in A-133 when performing the
risk assessments on Type B programs? (A-133 .520(d);SOP 98-3
7.14)
22. At a minimum, did the auditor audit all of the following as major
programs: (A-133 .520; SOP 98-3 7.17)
a. All Type A programs not identified as low risk?

b. Option 1: At least half of the high-risk Type B programs over the

Type B threshold, if risk was assessed for all Type B programs subject
to risk assessment? (Note: The auditor is not required to audit
more high- risk Type B programs than the number of Type A
programs identified as low risk.)

or

Option 2: At least one high-risk Type B program for each low-risk

Type A program?

c. Programs that are requested in accordance with the requirements in

A-133 .215(c) to be audited as major?

d. Such additional programs as may be necessary to comply with the

percentage of coverage rule?
Schedule of Expenditures of Federal Awards

23. Do the working papers evidence that the auditor:

a. Performed procedures to determine that the Schedule of Expenditures
of Federal Awards is presented fairly in all material respects in relation

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 Review Item Yes No N/A Ref.
to the auditee’s financial statements taken as a whole? (SOP 98-3
5.1)

b. Determined that the auditee was able to reconcile amounts presented

in the schedule to amounts in the financial statements? (SOP 98-3
5.5)
c. Assessed the appropriateness and completeness of the auditee’s
identification of Federal programs included in the schedule?
(SOP 98-3 5.4)

d. Considered whether a reportable condition existed if the auditee was

unable to identify federally funded expenditures separately?
(SOP 98-3 5.4)

e. Determined that the auditee properly disclosed the basis of accounting

and the significant accounting policies used in preparing the schedule?
(SOP 98-3 5.5)
24. Were Federal awards identified in the audit working papers (including
noncash awards) included in the schedule? (SOP 98-3 5.4)
Audit Follow-Up

25. Did the auditor perform procedures to assess the reasonableness of

the Summary Schedule of Prior Findings? (A-133 .500(e))

Reporting

[Note: Reviewers should obtain the results of the initial review of the audit
report for the entity subject to QCR. If an initial review was not performed,
the reviewer should perform an initial review using the PCIE Uniform Guide
for Initial Review of A-133 Audit Reports. In either case, the following
additional report review items should be completed during the QCR
process.]
26. Was all noncompliance that could have a direct and material effect on
the financial statements and that was identified in the audit working
papers reported? (GAS 5.15; A-133 .505(d)(2))
27. Were all reportable conditions that could have a direct and material
effect on the determination of financial statement amounts and that
were identified in the audit working papers reported? (GAS 5.15,
5.26; A-133 .505(d)(2); SOP 98-3 10.28)

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 Review Item Yes No N/A Ref.
28. If reportable conditions were identified that were not considered to be
material weaknesses, do the audit working papers document the
auditor’s assessment to this effect, and does the assessment appear
reasonable?
29. Did the auditor report known questioned costs exceeding $10,000 for
a Federal program that is not audited as a major program?
(A-133 .510(a)(4); SOP 98-3 10.63(d))
Complete Attachment I for each major program reviewed. The following
questions capture the overall summary of results relating to major programs
for which Attachment I was completed.

List of Major Programs Reviewed

Summary Results of Attachment I

Internal Control Over Major Programs

30. Was the internal control planning and testing adequate for each major
program for which Attachment I was completed? (A-133 .500(c))
31. Did the Schedule of Findings and Questioned Costs include all
reportable conditions in internal control over major programs?
[Note: The determination of whether a deficiency in internal control
is reportable is made in relation to a type of compliance requirement
or an audit objective identified in the Compliance Supplement for a
major program.] (A-133 .510(a)(1))
Compliance Requirements for Major Programs

32. Did the auditor properly determine whether the auditee complied with
laws, regulations, and provisions of contracts or grant agreements
that may have a direct and material effect on each of its major
programs? (A-133.500(d))

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 Review Item Yes No N/A Ref.
33. In the reviewer’s judgment, was the proper opinion rendered on each
major program based on the results of audit tests identified in the
audit working papers? (SOP 98-3 6.52)
34. Did the Schedule of Findings and Questioned Costs include all
compliance findings and questioned costs required to be reported?
(A-133.510(a)(2-7); SOP 98-3 10.63(b-g))
Data Collection Form

35. Based on the reporting package, data collection form, and results of
the QCR, did the auditor properly identify in Part III, Item 5, the
Federal agencies required to receive the reporting package?
(A-133 .320(b)(3); SOP 98-3 10.72)
36. Based on the reporting package, data collection form, and results of
the QCR, did the auditor properly complete Part III, Item 6? [Note:
The reviewer may answer this question based on the major programs
that were reviewed as part of the QCR.]
(A-133 .320(b)(3); SOP 98-3 10.72)
37. Based on the reporting package, data collection form, and results of
the QCR, did the auditor properly complete Part III, Item 7? [Note:
The reviewer may answer this question based on the major programs
that were reviewed as part of the QCR.]
(A-133 .320(b)(3); SOP 98-3 10.72)

Reference Notes

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 Review Item Yes No N/A Ref.
A SEPARATE ATTACHMENT SHOULD BE COMPLETED FOR EACH MAJOR PROGRAM REVIEWED

Materiality Considerations Relating

to Major Federal Programs

1.Did the auditor, in designing audit tests and developing an opinion on major
program compliance, determine materiality based on the major program?
(SOP 98-3 3.35, 6.14-.15)
2.Do the working papers evidence that the auditor considered
noncompliance, both individually and when aggregated, in determining
whether to express a qualified or adverse opinion on compliance? (SOP 98-3
3.38, 6.15)
Internal Control

3.For each of the 14 types of compliance requirements (listed in the

Compliance Supplement) that are applicable and material to the major
program, did the auditor document an understanding of the 5 components of
internal control (Control Environment, Risk Assessment, Control Activities,
Information and Communication, and Monitoring) sufficient to plan the audit
to support a low assessed level of control risk? (A-133 .500(c)(1); SOP 98-3
8.7, 8.9-.11)

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 Review Item Yes No N/A Ref.
4.Did the auditor plan the testing of internal control over the major program
to support a low assessed level of control risk for the assertions relevant to
each material compliance requirement for the major program? (A-133
.500(c)(2)(i); SOP 98-3 8.16)
5.Did the auditor perform the planned testing of internal control? (A-133
.500(c)(2)(ii); SOP 98-3 8.16)
6.If the auditor omitted testing of controls for any material requirement
because the auditor concluded that internal control was likely to be
ineffective, did the report and workpapers include the following: (A-133
.500(c)(3); SOP 98-3 8.20-.21, 8.24)
a. A reportable condition as part of the audit findings?

b. Control risk assessed at the maximum and a consideration of whether

additional tests were required?

7.Do the working papers adequately document the work performed and the
conclusions reached? (AU 339.05)
8.In the judgment of the reviewer, were the nature and extent of the
documented tests of controls sufficient to enable the auditor to reach a
conclusion on the effectiveness of internal control for preventing or detecting
noncompliance relevant to the material compliance requirements for the
major program?
9.Do the working papers evidence that the auditor's determination of whether
a deficiency in internal control was a reportable condition was made in
relation to a type of compliance requirement for a major program or an audit
objective identified in the Compliance Supplement? (A-133 .510(a)(1); SOP
98-3 8.26)
10.Were all reportable conditions identified as audit findings?
(A-133 .510(a)(1); SOP 98-3 10.63a)
Compliance Testing

11.Did the auditor identify all applicable and material compliance

requirements for the major program? (Note: For programs included in the
Compliance Supplement, after considering any unique requirements that
affect the Compliance Supplement’s guidance, the auditor need consider
only the requirements contained therein. For programs not included, the
auditor should follow the guidance in Part 7 of the Compliance Supplement
for identifying the applicable compliance requirements.) (A-133 .500(d)(3);
SOP 98-3 6.20-.21, 6.27-.30)
12.Did the auditor perform reasonable procedures to ensure that the
compliance requirements were current? (A-133 .500(d)(3); SOP 98-3 6.24)

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 Review Item Yes No N/A Ref.
13.Do the working papers adequately document the work performed and the
conclusions reached? (AU 339.05)

14.Did the auditor report all findings and questioned costs identified in the
audit working papers that met any of the following conditions: (A-133
.510(a)(2-7); SOP 98-3 10.63(b-g))
a. Material noncompliance with the provisions of laws, regulations,
contracts, or grant agreements related to a major program? [Note:
The determination of material noncompliance is in relation to a type
of compliance requirement for a major program or audit objective
identified in the Compliance Supplement.]

b. Known questioned costs when the known or likely questioned costs

exceed $10,000 for a type of compliance requirement for a major
program?

c. Known fraud affecting a Federal award unless the fraud was already
reported in accordance with GAS?

d. Instances in which the results of audit follow-up procedures disclosed

that the summary schedule of prior audit findings prepared by the
auditee materially misrepresents the status of any prior audit finding
pertaining to this major program?
15.In the judgment of the reviewer, were the nature and
extent of audit testing adequate to meet the audit objectives as identified
in the Compliance Supplement for all material compliance requirements, and
do the results support the auditor’s compliance opinion on the major
program? (A-133 .500(d)(4); SOP 98-3 6.36-.47)
16.Did the auditor perform procedures to assess the reasonableness of the
summary schedule of prior findings? (A-133 .500(e))

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 Review Item Yes No N/A Ref.

Reference Notes

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