AICPA SAS 112 on Internal Controls:. Implications and Impacts on State Agencies and Auditors Presented by Frank Crawford, CPA Crawford & Associates, P.C. www.crawfordcpas.com firstname.lastname@example.org. Auditor’s Responsibilities.
Implications and Impacts
on State Agencies and Auditors
Presented by Frank Crawford, CPA
Crawford & Associates, P.C.
A reportable condition involves a matter coming to the auditors attention relating to significant deficiencies in the design or operation of the internal control that, in the auditor’s judgment, could adversely affect the organization’s ability to initiate, record, process, and report financial data consistent with the assertions of management in the financial statements.
A significant deficiency is a control deficiency, or combination of control deficiencies, that adversely affects the entity’s ability to initiate, authorize, record, process, or report financial data reliably in accordance with GAAP or OCBOA, such that there is more than a remotelikelihood that a misstatement of the entity’s financial statements that is more than inconsequential will not be prevented or detected.Significant Deficiency
A material weakness is a reportable condition in which the design or operation of one or more of the internal control components does not reduce to a relatively low level the risk that misstatements caused by error or fraud in amounts that would be material in relation to the financial statements being audited may occur and not be detected within a timely period by employees in the normal course of performing their assigned functions.
A material weakness is a significant deficiency, or combination of significant deficiencies, that results in more than a remote likelihood that a material misstatement of the financial statements will not be prevented or detected.Material Weakness