Budgetary Controls and Linking Budgetary and Proprietary Control Testing

1  Background  Risks And Control Objectives  Testing Overview

2 Budgetary Controls and Linking Budgetary and Proprietary Control Testing  The Statement of Budgetary Resources  Objectives  NASA Error Background

3 Budget authority could be misstated or recorded in the wrong accounts, resulting in obligations in excess of resources, or obligations are less than what is available Budgetary Controls and Linking Budgetary and Proprietary Control Testing Risks  Risk  Assertions  Example – Budget Authority Existence – Budget authority is available and recorded in the right account Completeness – ALL budget authority was recorded properly

4 Budgetary Controls and Linking Budgetary and Proprietary Control Testing Now For The Rest of The Statement Risks

5 Budgetary Controls and Linking Budgetary and Proprietary Control Testing  Budget Authority  Unobligated Balances, Beginning of Period  Spending Authority From Offsetting Collections  Recoveries  Not Available Risks - Resources

6 Budgetary Controls and Linking Budgetary and Proprietary Control Testing  Obligations Incurred  Unobligated Balances Risks – Status of Resources

7 Budgetary Controls and Linking Budgetary and Proprietary Control Testing  Obligated Balances, Net EFY  Offsetting Receipts Risks - Outlays

8 Budgetary Controls and Linking Budgetary and Proprietary Control Testing  Document The Process  Flowchart  Identify Key Controls  Test The Controls Testing

9 Budgetary Controls and Linking Budgetary and Proprietary Control Testing Now, The Part You Have all Been Waiting For!!! Linking

10 Budgetary Controls and Linking Budgetary and Proprietary Control Testing Eric Eisenstein Linking

11 Budgetary Controls and Linking Budgetary and Proprietary Control Testing To maximize effectiveness and efficiency, tests of budgetary and proprietary accounts should be combined when interrelationships exist. Linking

12 Budgetary Controls and Linking Budgetary and Proprietary Control Testing  Must Understand Interrelationships  Must Document the Relationship  Must Document How the Proprietary Test Provides Assurance About the Budgetary Line Linking

13 Budgetary Controls and Linking Budgetary and Proprietary Control Testing  Controls Over Outlays May Linked With Disbursement Controls  Accounts Payable And Disbursement Controls May Be Linked To Controls Over UDO’s  Controls over the Spending Authority From Offsetting Collections May be Linked To Revenue Testing Examples