Attention auditors! Today, we issue a new revision of the Generally Accepted Government Auditing Standards, also known as the “Yellow Book,” which supersedes the 2018 revision of the standards. The Yellow Book is the book of standards and guidance for government auditing—outlining the requirements that make for effective, quality audits when reviewing government programs and spending. It’s used by our federal government auditors here at GAO, as well as federal, state and local auditors; inspectors general; and auditors of entities that receive government awards.
Today’s WatchBlog post takes a closer look at this important guidance and our updates.
Our high standards
Government Auditing Standards (known as the "Yellow Book") provide a framework for performing high-quality audit work—helping ensure work is conducted with integrity, objectivity, and independence. Auditing using the Yellow Book leads to greater accountability within government and improved government operations and services.
Integrity ensures that auditors perform their work with an attitude that is objective, fact-based, nonpartisan, and nonideological. Integrity means that auditors make decisions consistent with the public interest. For example, during an audit, auditors may encounter pressures and incentives to change procedures or reports for personal gain. In resolving these conflicts and pressures, acting with integrity means that auditors place priority on serving the public interest.
Objectivity and independence are closely related. Objectivity includes independence of mind and appearance when conducting engagements, maintaining an attitude of impartiality, having intellectual honesty, and being free of conflicts of interest. Independence ensures that people working on audits do not have personal interests in an audit outcome. For example, if an auditor is enrolled in a federal program (such as a small business loan program), they should not be auditing that program. To ensure independence here at GAO, we ask our analysts and auditors to attest to their independence on a biweekly basis.
A change in approach
The Yellow Book’s quality requirements focus on actions that ensure that the audit organization complies with professional standards and applicable legal and regulatory requirements. The 2024 Yellow Book’s section on quality requirements includes several major changes from the 2018 version. In particular, the revision reflects a change in approach from quality control to quality management. The standard has been influenced by the audit community’s concerns about audit quality and the scalability of quality management standards for audit organizations that vary in size, number of offices, and in the nature and complexity of work. The standards reflect a more modern approach with an emphasis on identifying and managing risks to quality and promoting scalability of the standard for use by all organizations.
The revision emphasizes that an audit organization’s leadership is responsible for proactively managing engagement quality and recognizes that audit organizations of different sizes and complexity need a scalable system of quality management for their circumstances.
Additional key updates for 2024 include:
- a risk-based process for achieving the objectives of quality management
- provisions for optional engagement quality reviews of generally accepted government auditing standards (GAGAS) engagements
- application guidance on key audit matters for financial audits
All of these updates and more can be found in the 2024 Yellow Book.
We welcome questions about the Yellow Book from any user or interested parties. While we won’t approve or endorse any specific course of action related to your question, we can guide you through the auditing standards so you can make an informed, professional decision.
If you have any questions related to the Yellow Book please call 202-512-9535 or e-mail YellowBook@gao.gov.
If you need help or have a question about our Green Book (Standards for Internal Control in the Federal Government), we can help there too! Just contact us at GreenBook@gao.gov or 202-512-9535.
- GAO’s fact-based, nonpartisan information helps Congress and federal agencies improve government. The WatchBlog lets us contextualize GAO’s work a little more for the public. Check out more of our posts at GAO.gov/blog.