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  • Getting a Handle on 2018 Revisions to the Yellow Book

    January 24, 2020 | By Steven Zapolski, CIA, CICA

    The 2018 revision of the Government Auditing Standards (commonly known as the Yellow Book) contains numerous changes, and getting a handle on these changes can be challenging. The purpose of this blog is to explore resources to assist you in getting a handle on the changes made to the Yellow Book, not in a matter of days but an hour or two.

    You have two principal options for understanding the differences—and one is significantly more difficult and time-consuming than the other. The more difficult option, of course, is to compare the 2011 and 2018 versions manually. The other option is to use resources already developed and vetted by experts, and designed to call out the most important changes relevant to you. If you perform a search in google for “2018 Yellow Book updates,” you would see numerous resources. These resources can be categorized into at least three key categories government entities, trade associations, and service providers.

    Government Entities

    The first resource we will discuss is a government entity and your primary resource: the Government Accountability Office (GAO) itself. According to www.gao.gov, the "GAO is the supreme audit institution for the United States. Federal and state auditors look to GAO to provide standards for internal controls, financial audits, and other types of government audits." In other words, they are the authors of the Yellow Book. The GAO has a podcast that provides an overview of the 2018 revisions to the Yellow Book, which discusses the updates. The five areas that are discussed in the podcast are as follows:

    1. The structure and application guidance
    2. Maintaining Independence
    3. Updates to peer review
    4. Guidance on waste
    5. Major changes for performance audits and internal controls

    Trade Associations

    The second resource consists of trade organizations such as the IIA Public Sector; Association of Local Government Auditors; National Associate of State Auditors, Comptrollers, and Treasurers; and the International Organization of Supreme Audit Institutions. These organizations host webinars, provide crosswalks (documents or presentations that compare previous and new versions in an easy-to-scan format) offer various training options, and speakers all focused on the Yellow Book and its recent revisions.

    For example, The Association of Local Government Auditors (ALGA) has created a crosswalk document posted on the ALGA website. The crosswalk document is an excel spreadsheet that is easy to navigate, enabling you to find updates that apply to your department. Each tab crosswalks a chapter in the 2018 Yellow Book, with a column that also indicates if the 2018 change is required or offered as guidance, which is one of the main changes to the Yellow Book. The crosswalk even color codes paragraphs to bring attention to significant changes.

    Service Providers

    The third time-saving resource is the extended network of industry-associated service providers. Service providers include software providers such as TeamMate, CPE providers such as Yellow Book CPE, or CPA firms. Service providers such as TeamMate are partners to the industry and provide useful resources such as documents, webinars, and even solutions to assist in understanding the changes between the 2011 and 2018 Yellow Book versions.

    For example, TeamMate’s thought leadership piece, “Helping Audit Departments Conform to the Yellow Book Standards,” located at this link here, demonstrates how the TeamMate+ solution can help you comply with the 2018 revision. Our solutions do not include only internally developed software but taking advantage of technology as a whole to provide solutions to meet your challenges. For example, TeamMate has taken the visualized the crosswalk document from the Association of Local Government Auditors and visualized the changes to help make it easier to understand.

    Getting a Handle on 2018 Revisions to the Yellow Book

    Even though there are many changes to the Yellow Book, getting a handle on the update is possible. By utilizing the resources discussed above; government entities, trade associations, and service providers, you can assess and implement the changes in a matter of hours and not days.

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