diff --git a/lib/spack/spack/audit.py b/lib/spack/spack/audit.py
index a93e151636e..68ed19602b2 100644
--- a/lib/spack/spack/audit.py
+++ b/lib/spack/spack/audit.py
@@ -350,7 +350,7 @@ def _ensure_no_folders_without_package_py(error_cls):
     for repository in spack.repo.PATH.repos:
         missing = []
         for entry in os.scandir(repository.packages_path):
-            if not entry.is_dir():
+            if not entry.is_dir() or entry.name == "__pycache__":
                 continue
             package_py = pathlib.Path(entry.path) / spack.repo.package_file_name
             if not package_py.exists():
diff --git a/lib/spack/spack/repo.py b/lib/spack/spack/repo.py
index 580d1ab2412..394aaf6b404 100644
--- a/lib/spack/spack/repo.py
+++ b/lib/spack/spack/repo.py
@@ -232,6 +232,8 @@ def get_all_package_diffs(type: str, repo: "Repo", rev1="HEAD^1", rev2="HEAD") -
     changed: Set[str] = set()
     for path in lines:
         dir_name, _, _ = path.partition("/")
+        if not nm.valid_module_name(dir_name, repo.package_api):
+            continue
         pkg_name = nm.pkg_dir_to_pkg_name(dir_name, repo.package_api)
         if pkg_name not in added and pkg_name not in removed:
             changed.add(pkg_name)
diff --git a/var/spack/repos/spack_repo/builtin/__init__.py b/var/spack/repos/spack_repo/builtin/__init__.py
new file mode 100644
index 00000000000..c4ecc87fb8a
--- /dev/null
+++ b/var/spack/repos/spack_repo/builtin/__init__.py
@@ -0,0 +1,3 @@
+# Copyright Spack Project Developers. See COPYRIGHT file for details.
+#
+# SPDX-License-Identifier: (Apache-2.0 OR MIT)
diff --git a/var/spack/repos/spack_repo/builtin/packages/__init__.py b/var/spack/repos/spack_repo/builtin/packages/__init__.py
new file mode 100644
index 00000000000..c4ecc87fb8a
--- /dev/null
+++ b/var/spack/repos/spack_repo/builtin/packages/__init__.py
@@ -0,0 +1,3 @@
+# Copyright Spack Project Developers. See COPYRIGHT file for details.
+#
+# SPDX-License-Identifier: (Apache-2.0 OR MIT)