Audit Standards and Procedures Relevant to Audits of Financial Institutions Involved in Significant Government Securities Repurchase Agreements

In response to a congressional request, GAO outlined those audit standards and procedures which were relevant to the examination of the assets, collateral, and liabilities of a financial institution involved in significant government securities repurchase agreements with unregulated government securities dealers. GAO stated that the objective of an independent audit was to express an opinion on the fairness of a company's financial statements and related disclosures in providing its financial position and operations results. GAO found that it was up to the auditor to understand the related risks and transactions associated with the client's business in order to achieve the objectives of determining the existence, ownership, and control over the assets and liabilities reflected in the financial statements and to ensure that they are properly valued, presented, and disclosed.