The New Data Collection Form and Important Clearinghouse System Changes

Transcription

1 The New Data Collection Form and Important Clearinghouse System Changes A Web Event September 26, 2013 Trouble Shooting Troubleshooting Tips No Audio? Ensure that your computer speakers are turned on that the volume is appropriately set Check to ensure that audio streaming is enabled on your computer If the presentation slides stop advancing during the presentation Close out of the presentation and re-launch the webcast If you are still having audio or other technical difficulty Check with your IT personnel at your firm to ensure that this event is not being blocked by a firewall Call the AICPA Service Center at Administrative Notes We encourage you to submit your technical questions please limit your questions to the content of today s program You can submit your questions at any time during this Web event by clicking on the Q & A tab on the lower right-hand side of your screen You can also download slides in PDF or PowerPoint by clicking on Handouts tab 3 1

2 Continuing Professional Education There will be random participation pop-up markers during the event To obtain CPE, you must click OK on 75% of the participation pop-up markers If you are not receiving CPE for this event, ignore the pop-up markers 4 Continuing Professional Education At the end of today s presentation we will provide steps for obtaining your CPE certificate Contact the Service Center for help with obtaining CPE at or service@aicpa.org If you are not receiving CPE for this event, ignore the pop-up markers if they appear. 5 Presenters Paul Fite Federal Audit Clearinghouse Eric Formberg, CPA Plante & Moran PLLC Tom Sneeringer, CPA McGladrey LLP Mark Swanhart Federal Audit Clearinghouse 6 2

3 What we will cover Overview and Background Submission Process Changes at the Federal Audit Clearinghouse (FAC) Changes to be Aware of in the Proposed 2013 Data Collection Form (DCF or the Form) Auditor Challenges Relating to the 2013 Form Issuance Tips to Avoid Common Filing Errors Key Takeaways/To-Do List 7 Overview and Background 8 Overview and Background DCF is a federal form that summarizes the results of audits performed under Office of Management and Budget (OMB) Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations DCF required to be updated periodically The FAC is the federal entity that collects the Forms and reporting packages and maintains the database of the completed audits Today s presentation to discuss the latest DCF and changes to the FAC system used to submit the Form Overarching Theme: Federal agencies heavily rely on the DCF auditees and auditors need to get it right! 9 3

4 Overview and Background 2013 DCF Federal Register notice issued in May; comments were due July 8, 2013 o Access GAQC Comment Letter The new Form and instructions will be applicable for audit periods ending in 2013, 2014, and 2015 Many significant changes proposed this time around 10 Overview and Background Second Federal Register Notice expected by mid-october Required 30-day final comment period Not likely to be many changes as a result of final comment period New Form expected to be finalized by late November (must be used for all 2013 audits) 11 Overview and Background 2013 DCF Filing extension provided on FAC Web site If a single audit for a fiscal period ending in 2013 is due before the 2013 Form is available, auditees will not be able to meet the thirty day deadline for submission prescribed by OMB Circular A-133 _.320(a). Therefore, OMB has granted an extension until December 31, 2013, for reporting packages due to the Clearinghouse before that date. The extension is automatic and there is no approval required. The extension applies only to single audits for the fiscal periods ending in

5 Overview and Background FAC Submission Web site changes New Internet Data Entry System (IDES) coming October 7, 2013! Other Form-related and FAC changes to look forward to 13 Submission Process Changes at the FAC 14 New FAC Submission Website Update Old IDES versus new IDES New log-in page Registration - new personal accounts New account home landing page Start form, revise form, review form, and view New report home landing page Other Enhancements Certification changes PDF requirements Future DCF planning 15 5

6 Old IDES User 1 User 2 User 3 User 4 Shared ID and Password 1 16 New IDES Example 1 PartnerOne@Auditor.com PartnerTwo@Auditor.com Account Login Account Login New IDES Example 2 Generic @Auditor.com PartnerOne@Auditor.com PartnerTwo@Auditor.com Account Login Account Login Account Login

7 New Login Page 19 Registration - New Personal Accounts Simply fill out the required information, and you will have access to all the reports in our database matched to your e mail address. No more report ID/password Combinations 20 Registration - New Personal Accounts address log-ins Each user must create one account using one address No report ID/password combinations Previous submissions ( ) are available in each user account (matched by address on previous reports) 21 7

8 Registration - New Personal Accounts Required Password 22 Registration - New Personal Accounts New Account Passwords Must receive required password (see prior slide) from govs.fac.ides@census.gov Password cannot be re-used Expires every 60 days, or after 30 days of no activity Easy to reset - Enter address and follow link on password Only one password reset allowed per day 23 Registration - New Personal Accounts Password Requirements At least 12 characters long (e.g., Auditee2579!) Must contain at least one of the following categories: o Upper case letters (A-Z) o Lower case letters (a-z) o Numbers (0-9) o Special characters from!@#$%^&*() o No character repeated more than 4 times (Stewie22222# will not work!) 24 8

9 Account Home 25 Account Home - Start New 26 Account Home - Start New 27 9

10 Account Home - Start New Certification officials are required for the auditee and auditor. Up to 5 additional contacts can be entered for both the auditor and auditee Enter the name and e- mail address of each person you want to have access to the report 28 New Home Only the designated certifying official can click certification buttons. No more signature codes. Time and date stamp Account logged in at time of step completion 29 Other Enhancements Eliminated security questions and answers Enter address to reset your password Better error messages Downloadable list More validation when submitting You must complete the Form before uploading the audit o Reduces errors 30 10

11 Other Enhancements Improved Spreadsheet Templates Templates are available for all pages where data upload is possible Download an Excel template customized for each report. Fill it out and upload it to the submission Data can be cut or copied from your data file and pasted easily into the Excel template 31 Other Enhancements - Spreadsheet Templates Fill out the template manually, or copy and paste directly from another database source. No more.csv files. Validations will prevent data submission errors 32 Certification Changes No signature codes Access to certification restricted to accounts identified as Certifying Official see slide 27 Completed by column to identify user who completed each step, along with the date and time see slide

12 PDF Requirement ISSUE: Over 40% of the audits uploaded in 2010 were not text searchable GOAL: 100% of FY 2014 audits are unlocked, unencrypted to allow copying and printing and 85% of the audit s pages are text-searchable Phase 1: Began testing audit uploads in August 2012 Phase 2: All FY 2014 audits must be unlocked, unencrypted and 85% of pages text searchable 34 PDF Requirement Advance Pass or Fail Notices with All Current Submissions 35 PDF Requirement How to create a compliant PDF Single Audit Detailed instructions located at: This document includes the following topics: What will cause my PDF to be locked or not text searchable? o Scanning a physical copy of your audit report o Changing the default security settings of your PDF How do I create a compliant PDF? o Using PDF software o Word Processor, i.e., Microsoft Office 2007, 2010, etc. Frequently Asked Questions o How do I sign a document electronically? o How do I create an electronic letterhead? 36 12

13 Future DCF Planning Comments on streamlined grants process proposal may affect the next Form Comments on 2013 Form may affect the next Form Personally Identifiable Information Certification (PII) Proposed Long Term - make all reporting packages available to the public 37 Changes to be Aware of in the Proposed 2013 Form 38 Proposed 2013 Form Changes Part I General Information Beginning with 2013 audits, all audit firms must report their Employer Identification Number (EIN) Secondary auditors must report their EIN on the secondary auditor contact information page Do not use social security numbers. Auditors must obtain EIN for FAC submission purposes Obtain EIN at Businesses-&-Self-Employed/Apply-for-an-Employer- Identification-Number-(EIN)-Online 39 13

14 Proposed 2013 Form Changes Part III: Federal Programs Identify Loan/Loan Guarantee (Yes/No) o CFDAs with Loan/Loan Guarantee components and non- Loan/Guarantee components expenditure detail for each component listed on separate lines Standardized Audit Finding Reference Numbers: YYYY-###, (ex , , etc.) o Will not be required for 2013 rather OMB requests that auditors begin using o Required to be implemented in 2014 o Reference numbers should match Schedule of Findings and Questioned Costs (SFQC) and audit reports Number of Audit Findings on Each Federal Award 40 Proposed 2013 Form Changes New Items in Part III: Federal Programs 41 Proposed 2013 Form Changes Part III, Item 7: Federal Awards Findings Summary Columns (a)-(c) automatically populated based on response to Part III, Item 6(k) Each federal award audit finding separately described Type of compliance requirement to be indicated Type of finding to be indicated: - Compliance (Modified Opinion or Other Matters) - Internal Control (Material Weakness or Significant Deficiency); or - Other Questioned costs related to the finding (Yes/No) 42 14

15 Proposed 2013 Form Changes New Part III, Item 7: Federal Awards Findings Summary New Standard Format for 2014 New information for Compliance, Internal Control and Other Findings New Questioned Costs 43 Proposed 2013 Form Changes New Part III, Item 7: Federal Awards Findings Summary There are 9 valid combinations of "Compliance Findings," "Internal Control Findings," and "Other Findings" for each Federal program with findings 44 Auditor Challenges Relating to the 2013 Form Issuance 45 15

16 Challenges Obtaining an EIN, if you don t have one Staff training Setting-up personal accounts Client training Dealing with the backlog of audits that have been completed prior to the 2013 DCF issuance Staffing Timing Extra hours/cost timing Other audit reporting deadlines/requirements 46 Tips to Avoid Common Filing Errors 47 Tips to Prepare and Review the Data Collection Form Part I: General Information Employer Identification Numbers (EIN) Have firm EIN accessible Request EIN of secondary auditors DUNS number: Ask the client as early in the audit as possible to obtain DUNS number and EIN. Note: a client may have multiple DUNS numbers Refer clients and staff to the FAC website for frequently asked questions concerning obtaining a DUNS number and other useful information. Requested, but still not required 48 16

17 Tips to Prepare and Review the Data Collection Form Part II: Financial Statements Part II, Item 1 asks for Type of Audit which refers to the financial statement report (and not the internal control and compliance reports) The person preparing Part II should be referring to the signed auditor reports to ensure this section is prepared using the final versions and reflects the actual results of the audit Note the clarified terminology in new Form, i.e., modified versus qualified 49 Tips to Prepare and Review the Data Collection Form Part III: Federal Programs Read the instructions to the new DCF for very useful information The person preparing Part III should be referring to the signed Circular A-133 report and SFQC to ensure this section is prepared using the final versions and reflects the actual results of the audit Item 6(f): Ensure Loan/Loan Guarantees are identified and that CFDAs with loan and nonloan components are listed on separate lines 50 Tips to Prepare and Review the Data Collection Form Part III: Federal Programs Common reconciling items include amounts that may be reported in the footnotes to the schedule of expenditures of federal awards. For example: o Student loan outstanding balances o Administrative cost allowances o Commodities o Donated property o Interest subsidies o Insurance 51 17

18 Red Flags Incorrect DCF Submissions Can Raise Part I not fully completed The Form was prepared in a hasty and sloppy manner. Part II wrong box checked The preparer does not understand the nature of the auditor report issued. Part III items 1-7 wrong boxes checked BOTTOM LINE FROM FEDERAL PERSPECTIVE The Form was prepared in a hasty and sloppy manner. Auditor may not understand following concepts: low-risk auditee, type of report issued, major programs, or nature of findings reported. BIG PROBLEM FEDERAL AGENCIES RELYING ON INCORRECT INFORMATION! 52 Quality Control Tips for Submission Reviews Consider using the database to perform a few quality checks Check type A program thresholds for your audits (Hint: if you find $500,000 you probably have a problem) See if doing any program-specific audits; if so, look at the DCF to determine if only one program or cluster noted Randomly drill down into some of your organization s DCFs to see if any other trends noted 53 Quality Control Tips for Submission Reviews Drilling Down Further Lack of identification of clusters Improper application of definition of a federal program (awards with same CFDA #) Missed major program based on type A program 2- year look back Missed major program based on type A program with a prescribed prior year finding Inadequate percentage of coverage Improper determination of low-risk auditee status Type A program threshold calculation errors 54 18

19 FAC Search Tips 55 FAC Search Tips 56 Key Takeaways/ To-Do List 57 19

20 Key Takeaways/To Do List Develop new internal policies for revised submission process and new DCF Plan and schedule staff training and check with clients for training/information needs Create personal accounts Revisit/redefine DCF quality review process Address backlog of completed audits by 12/31/13 Consider completing a few submissions on paper for practice Ensure ample time in schedules for new submission process and changes to DCF Coordinate submissions with clients Make sure information on DCF reflects actual audit results! 58 Questions????? 59 How do I get my CPE certificate? Just follow these steps: 1. Log on to CPA2Biz.com 2. Click on My Account at the top of the page and enter your CPA2Biz/AICPA username and password 3. Click on My Web Events tab 4. Click on AICPA Learning Center Transcripts and Certificates link (a new window or tab will open) 5. On the AICPA Learning Center, click on My Transcript in the left-hand menu 6. Locate your completed course and click on Go to retrieve your certificate. Please note that it may take up to 24 hours for your certificate to be placed into your account. If you need assistance with locating your certificate, please contact the AICPA Service Center at or service@aicpa.org

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