Generally Accepted Auditing Standards (GAAS) are guidelines applied by auditors in deciding whether financial statements have been prepared according to GAAP.
GAAS serve as the overarching framework for the three main financial auditing standards in the United States: SAS, PCAOB standards and the GAGAS. Auditors use the American Institute of Certified Public Accountants' (AICPA) Statements on Auditing Standards (SAS) to evaluate privately-held companies. Publically traded companies are audited using standards developed by the Public Company Accounting Oversight Board (PCAOB). Government entitites and organizatiosn receiving government funding perform audits using the Generally Accepted Government Auditing Standards (GAGAS -- also referred to as the Yellow Book), which are set by the United States Government Accountability Office (GAO).
The Auditing Standards Board (ASB) is the senior committee of the AICPA designated by Council to issue auditing, attestation, and quality control standards and practice guidance for performing and reporting on audit and attestation engagements for nonissuers (that is, entities not included within the jurisdiction of the Public Company Accounting Oversight Board (PCAOB)).
The Accounting and Review Services Committee (ARSC) is the AICPA’s senior committee for compilations or reviews and is designated to issue pronouncements in connection with the unaudited financial statements or other unaudited financial information of nonpublic entities. Its mission is to develop and communicate comprehensive performance and reporting standards and practice guidance to enable accountants of nonissuers to provide high quality, objective compilation and review services in the best interests of the profession and the users of compiled and reviewed financial statements, with the ultimate purpose of serving the public interest. Learn more about ARSC in its Operating Policies.
In response to the Enron accounting scandal, the Sarbanes-Oxley Act of 2002, Pub. L. 107-204, 116 Stat. 745 (2002) created the Public Company Accounting Oversight Board (PCAOB) and gave it authority to establish auditing standards for public companies registered with the SEC. The 5 members of the PCAOB's Governing Board are appointed by the SEC and serve 5-year terms; no person may serve more than two terms. Two members must be or have been Certified Public Accountants ("CPAs") for at least 5 years prior to appointment. The other 3 members must not be or have been CPAs. PCAOB officially assumed its standards-making responsibility in 2003, but adopted AICPA auditing standards existing as of April 16, 2003 as interim auditing standards. PCAOB standards adopted after April 16, 2003 may supersede or amend AICPA auditing standards for audits of public companies.
Where to find PCAOB standards:
The United States Government Accountability Office (GAO), led by the Comptroller General, is responsible for setting auditing standards for government entities and bodies that receive government funding. GAO is held to be "the supreme auditing institution in the United States." GAO maintains the Generally Accepted Government Auditing Standards (GAGAS) as guidance for federal, state and local government officials to set up internal controls, and to perform financial and other types of audits.