Final answer:
Audits conducted under GAGAS often use lower materiality levels than non-GAGAS audits due to the heightened public interest in government accountability and the precise reporting expected for the use of taxpayer money.
Step-by-step explanation:
True, according to the Government Auditing Standards, also known as the Yellow Book, audits performed in accordance with Generally Accepted Government Auditing Standards (GAGAS) may use lower materiality levels than non-GAGAS audits. The concept of materiality in an audit refers to the significance of an amount, transaction, or discrepancy that might affect the decisions of users relying on the financial statements. Materiality levels are determined based on the needs of these users, and those needs may vary given the public interest in government accountability.
In GAGAS audits, the auditors have the responsibility to consider the qualitative aspects of the entity's operations, including matters related to public interest and the use of taxpayer money. Therefore, auditors might determine a lower threshold for materiality in order to ensure a high level of precision in reporting on the entity's financial statements and compliance with laws and regulations.