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SBOA Glossary of Accounting and Audit Terms

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Preface | Authoritative Bodies | Acronyms

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Preface

The Indiana State Board of Accounts has the statutory duty to examine all accounts and financial affairs of every public office and officer, state office, state institution, and entity within the State of Indiana. It is our mission to provide its citizens with complete confidence in the integrity and financial accountability of state and local government. In our continuance to provide the highest level of professional service to governmental units and the public, we have created a glossary of accounting and auditing terms that are relevant to the audit work conducted within the State of Indiana and our agency.

The glossary contains definitions of accounting, reporting, and auditing terms that are commonly used in the course of conducting our engagements and often appear in the reports issued by our agency.

We have provided sources for these definitions for further reference. The most authoritative source is provided but additional sources maybe available. There are terms listed within this glossary that are not explicitly defined in authoritative guidance. In these instances, the State Board of Accounts has compiled definitions based on research and our staffs' knowledge and experience.

Our reports are intended to provide objective information about the financial condition and compliance with the laws and regulations governing the units and entities we examine. It is our hope that the glossary is a beneficial resource in reviewing our reports and gives a proper perspective of the findings contained within our reports. An online version of this glossary is also available on our website.

If you have any questions for our office, whether it be about these terms, or otherwise, please don’t hesitate to call our office at (317) 232-2513 or send an email to one of the following:

Cities.Towns@sboa.in.gov
Communications@sboa.in.gov
Counties@sboa.in.gov
Libraries@sboa.in.gov
NotForProfit@sboa.in.gov
Schools.Townships@sboa.in.gov
SpecialDistricts@sboa.in.gov

Paul D. Joyce, CPA, State Examiner
Michael H. Bozymski, CPA, Deputy State Examiner
Tammy R. White, CPA, Deputy State Examiner


A

Abuse


Access Controls


Accountability


Accrual Basis of Accounting


Activities Allowed or Unallowed Requirements


Adverse Opinion


Agency Funds


Agreed-Upon Procedures Engagement


Allowable Cost/Cost Principles Requirements


American Institute of Certified Public Accountants (AICPA)


Amortization


Analytical Procedures


Annual Financial Report (AFR)


Appropriateness (of Audit Evidence)


Assertion


Asset


Attestation Engagements


Audit Committee


Audit Documentation


Audit evidence


Auditing Standards Board


Audit Report


Auditor’s Specialist

B

Balance Sheet


Basic Financial Statements


Basis of Accounting


Best Practices


Business-Type Activities


C

Capital Assets


Cash Basis of Accounting


Cash Management Requirements


Catalog of Federal Domestic Assistance (CFDA)


Certificate of Achievement for Excellence in Financial Reporting Program


Certified Fraud Examiner (CFE)


Certified Government Financial Manager (CGFM)


Certified Information Systems Auditor (CISA)


Certified Public Accountant (CPA)


Cluster of Programs


Cognizant Agency


Combining Financial Statements


Committee of Sponsoring Organizations of the Treadway Commission (COSO)


Comparative Financial Statements


Compliance Audit


Compliance Requirements in a Single Audit


Compliance Supplement


Components of Internal Control


Component Unit


Comprehensive Annual Financial Report (CAFR)


Computer-Assisted Audit Techniques (CAATs)


Confidential and Sensitive Information


Conflict of Interest


Continuing Professional Education (CPE)


Contract


Contractor


Control Activities


Control Environment


Control Risk


Corrective Action Plan


Cost Principles


Criteria


D


Data Reliability


Deferred Outflows/Inflows of Resources


Depreciation


Derivative


Detection Risk


Disclaimer of Opinion


Detective Control


Disaster Recovery Plan


Disallowed Cost


Due Professional Care


E

Earmarking


Elements of a Finding


Eligibility Requirements


Emphasis-of-matter Paragraph


Engagement Letter


Enterprise Fund


Entrance Conference


Equipment and Real Property Management Requirements


Exit Conference


Expenditure/Expense


F

Federal Audit Clearinghouse (FAC)


Federal Award


Federal Awarding Agency


Federal Program


Fiduciary Fund


Financial Accounting Standards Board (FASB)


Financial Reporting Entity


Financial Statement Audit


Financial Statements


Finding


Fiscal Year


Fraud


Fraud Risk Factors


Fraudulent Financial Reporting


Fund Balance


Fund Financial Statements


Fund/Fund Accounting


Fund Type


G

General Fund


Generally Accepted Accounting Principles (GAAP)


Generally Accepted Auditing Standards (GAAS)


Generally Accepted Government Auditing Standards (GAGAS)


Going-Concern


Government Accountability Office (GAO)


Governmental Accounting Standards Board (GASB)


Governmental Activities


Governmental Funds


Government-Wide Financial Statements


Grant


Grant Agreement


Grantor


Grantee


Green Book


H

I

Improper Payment


Independence


Independent Auditor (External Auditor)


Independent Auditor’s Report


Independent Auditor’s Report on Compliance for the Major Federal Program and on Internal Control over Compliance


Independent Auditor’s Report on Internal Control and Compliance over Financial Reporting


Independent Auditor’s Report on the Schedule of Expenditures of Federal Awards (SEFA)


Indiana Gateway for Governmental Units


Indirect Cost


Indirect Cost Rate


Inherent Risk


Information and Communication


Infrastructure Asset


In-Kind Contributions


In-Relation-To Opinion


Internal Auditor


Internal Control


Internal Control Deficiency


Internal Service Fund


J

K

L

Liability


M


Maintenance of Effort


Major Federal Program


Major Fund


Malfeasance


Management’s Discussion and Analysis


Management’s Specialist


Matching Requirements


Material/Materiality


Material Noncompliance


Material Weakness


Methodology


Misfeasance


Misstatement/Material Misstatement


Modified Accrual Basis of Accounting


Monitoring


N


Net Position


Noncompliance


Nonfeasance


Nonmajor Fund


Notes to the Financial Statements


O


Objectives


Other Comprehensive Basis of Accounting (OCBOA)


Other Postemployment Benefits (OPEB)


Office of Management and Budget (OMB)


Opinion Unit


Other-Matter Paragraph


P


Pass-Through Entity


Peer Review


Performance Audit


Performance Measures


Permanent Fund


Pervasive


Population


Postemployment Benefits


Preventive Controls


Primary Government


Procurement and Suspension and Debarment Requirements


Professional Judgment


Professional Skepticism


Program Income


Proprietary Fund


Public Record


Q


Qualified Opinion


Questioned Costs


Questioned Cost Resolution


R


Recommendation


Relevance of Audit Evidence


Reporting Requirements


Regulatory Basis


Repeat Finding


Representation Letter


Required Supplementary Information (RSI)


Revenue


Review Engagement


Risk


Risk Assessment


Risk of Material Misstatement


Risk of Material Noncompliance


S


Sampling


Sampling Risk


Schedule of Expenditures of Federal Awards (SEFA)


Schedule of Findings and Questioned Costs


Scope


Scope Limitation


Segregation of Duties


Service Organization


Significance


Significant Deficiency


Single Audit


Software Application


Special Revenue Fund


Special Purpose Framework


Special Test and Provisions Requirements


Standard Chart of Accounts


Standards for Internal Control in the Federal Government (Green Book)


State Board of Accounts


Statement of Activities


Statement of Cash Flows


Statement of Changes in Fiduciary Net Position


Statement of Fiduciary Net Position


Statement of Revenues, Expenditures, and Changes in Fund Balances


Subaward


Subrecipient


Subsequent Events


Sufficiency of Audit Evidence


Summary Schedule of Prior Audit Findings


Supplementary Information


Suspension and Debarment


T


Tax Abatement


Those Charged with Governance


Transparency


Types of Financial Statement Audit Report Opinions


Types of Single Audit Compliance Report Opinions


Type 1 Report


Type 2 Report


U


Uniform Compliance Guidelines


Uniform Guidance


Unmodified Opinion


Unrestricted Net Position


User Permissions


V


W


Working Papers


X


Y


Yellow Book

Z


Authoritative Bodies


Acronyms