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2. Modified Approach. Asset-Management SystemDocumentation RequirementsExpendituresTransition RequirementsRequired Supplementary Information (RSI)Required note disclosures to RSI. 3. Auditor Considerations
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1. 1 GASB 34 Modified Approach & RSI— Auditor Perspective Gerry C. Boaz
Tennessee Division of State Audit
April 25, 2001
2. 2 Modified Approach Asset-Management System
Documentation Requirements
Expenditures
Transition Requirements
Required Supplementary Information (RSI)
Required note disclosures to RSI
3. 3 Auditor Considerations — Modified Approach Asset management systems used by management have the required characteristics
Eligible infrastructure assets are properly recorded
Capitalized amounts represent only original cost plus additions or improvements
No accumulated depreciation was recorded for those assets
4. 4 Auditor Considerations — Modified Approach Major classes of capital assets are separately identified
Detailed capital asset records are (or are not) available
Condition assessment requirements have been met
Condition assessments are replicable
5. 5 Auditor Considerations — Modified Approach Contractors or specialists are used to perform condition assessments
RSI, including MD&A and Notes to RSI, includes required information
6. 6 Auditor Responsibility for RSI Inquire about methods of preparing RSI
Compare information for consistency
Consider written representations
Apply additional procedures
Make additional inquiries
Disclaim opinion in auditor-submitted documents
Say nothing or disclaim opinion in client-prepared documents
7. 7 Auditor RSI Reporting Explanatory paragraph could be added to the opinion letter under the following circumstances:
Omission of RSI
Material departures from GAAP
Auditor procedures not completed
Auditor’s unresolved doubts about presentation
8. 8 Words of Advice Start preparing now!
Create an implementation plan
Work with your auditors early and often
Start preparing now!