Possible bug in git-completion.sh

If I create a directory "build" at the top of my git repository and then
add it to .gitignore, git behaves as expected and ignores the build
directory when checking status. Now git-completion.sh has some issues. I
have GIT_PS1_SHOWUNTRACKEDFILES to "1", so that I will be notified when
there are untracked files in my working directory. When I'm in the
top-level directory my prompt looks like expected, no '%'. However if I
change to the build directory I get a '%', even though git status shows
no untracked files. I see that git-completion.sh is using git ls-files
to check this and that function does indeed show output when in my build
directory. So the question here: Is git-completion.sh using ls-files
improperly or is ls-files behaving improperly?

-- 
Jon Schewe | http://mtu.net/~jpschewe
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For I am convinced that neither death nor life, neither angels nor
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neither height nor depth, nor anything else in all creation, will
be able to separate us from the love of God that is in Christ
Jesus our Lord. - Romans 8:38-39