An auditor is engaged to audit the Eastern Planning and Development District, a not-for-profit entity that receives federal financial assistance. The auditor designed his audit to provide reasonable assurance of detecting material misstatements resulting from illegal acts. What additional requirements does the auditor have with regard to compliance? None. The auditor must design the audit to provide reasonable assurance of detecting noncompliance with terms of grants and contracts. The auditor must design the audit to provide reasonable assurance of detecting all misstatements resulting from illegal acts. The auditor must design the audit to provide reasonable assurance of detecting any fraud.