How many reports does an auditor prepare in a GAGAS engagement?

In a GAGAS (Generally Accepted Government Auditing Standards) engagement, auditors are required to prepare two distinct reports. One report is typically on the financial statements, which presents the auditor's opinion on the accuracy and fairness of those statements in accordance with the applicable financial reporting frameworks. The second report focuses on compliance and internal controls, which outlines whether the entity complied with applicable laws and regulations and addresses any internal control deficiencies identified during the audit.

This dual-reporting requirement is a fundamental aspect of GAGAS engagements, reflecting the standards' emphasis on accountability and transparency in government auditing. The preparation of both reports ensures that stakeholders receive a comprehensive view of the entity's financial health and operational integrity. This commitment to thoroughness reinforces the GAGAS goal to enhance the quality and reliability of financial and performance reporting in government entities.