Audits, in accordance with Generally Accepted Governmental Auditing Standards (GAGAS), require that an auditor determines a governmental entity's risk of non-compliance with requirements and laws. This is similar to audit risk, in that an audit risk of noncompliance is the risk that an auditor may issue an unqualified opinion on false, fraudulent and non-compliant financial statements.
Audit Risk of Noncompliance consists of three components:
- Detection Risk of Noncompliance
- Inherent Risk of Noncompliance
- Control Risk of Noncompliance
