Government Accounting and Auditing


GOVERNMENT ACCOUNTING AND AUDITING

The IRS needs to improve its accounting procedures and internal controls, says the GAO. In audit findings, the watchdog agency cited the IRS’s inaccuracy in reporting costs for reimbursable activities, lack of procedures to record working-capital-fund prepaid expenses, use in financial reports of unverified financial information from contractors and premature transfer of funds from one budget appropriation to another ( www.gao.gov/cgi-bin/fetchrpt?rptno=GAO-01-880R ).

The Department of Defense’s Contract Audit Agency issues guidance to help the DOD, by 2005, base most of its fixed-price service contracts on contractor performance. The guidance encourages cooperation between auditors and contracting officers to devise and apply criteria for assessing the propriety of payments based on performance and to share knowledge of contractors’ financial strength ( www.dcaa.mil/mmr/m01ppd056.pdf ).

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In focus: Payroll

Providing payroll services that comply with ever-changing regulations and meet evolving employee and employer demands is no easy task. Paychex's Tom Hammond discusses common payroll considerations for CPA firms.