Diversity of Due Process Stakeholder Participation: An Examination of Yellow Book Auditing Standards

• In Event: Auditing

Abstract

Auditors are required to follow governmental auditing standards when performing audits of entities expending significant federal government dollars. This study explores the diversity of the stakeholders participating in the comment letter phase in conjunction with the creation of government auditing standards. Our analysis of the 95 comment letters received by the US Government Accountability Office (GAO) for their 2017 Exposure Draft for the current version of the government auditing standards reveals a strong bias towards auditor participation. Other groups, including users and preparers of governmental information, are not well represented amongst the comment letter writers. The geographic spread and gender of the letter writers do provide limited diversity to the GAO. Also, the comment letter writers respond to the GAO’s directed questions more than they spontaneously comment on the chapters of the document. Our findings are consistent with a narrow group of stakeholders influencing the standards potentially resulting in suboptimal standards. The implications for our study reveal opportunities for academics, government accounting preparers and users of government auditing standards output to be more engaged in the standard-setting process.

Authors

• Renee Flasher, Penn State Harrisburg

• Michelle Lau, Brock University

• Dara M Marshall, Texas A&M University-Central Texas-Killeen