Proposed statement on auditing standards : compliance auditing : the auditor\u27s responsibility for testing compliance with laws, regulations, and contractual terms governing financial assistance certain entities receive from government ;Compliance auditing : the auditor\u27s responsibility for testing compliance with laws, regulations, and contractual terms governing financial assistance certain entities receive from government; Exposure draft (American Institute of Certified Public Accountants), 1988, May 6

In response to findings that a large proportion of independent audits of federal financial assistance were substandard, the AICPA Task Force on the Quality of Audits of Governemental Units was formed to develop a comprehensive plan to improve the quality of audits of governmental units. That plan, presented in a March 1987 report, included a recommendation that a statement on auditing standards relating to auditing for and reporting on compliance with applicable laws and regulations should be developed and issued. This proposed Statement provides guidance on applying the requirements of SAS No. 54, Illegal Acts by Clients, to audits of certain entities that receive financial assistance from government. It explains the relationship between those requirements and the requirements of the Standards for Audit of Governmental Organizations, Programs, Activities, and Functions issued by the United States General Accounting Office. It also provides guidance on testing compliance with laws and regulations applicable to federal financial assistance programs in audits performed in accordance with the Single Audit Act of 1984.https://egrove.olemiss.edu/aicpa_sop/1514/thumbnail.jp