Jerah Y.

Torrejos
Let’s Check
EXERCISE 1
Link the correct definition to each term.
a. Accountable i. Qualified Opinion
b. Steward j. Persuasiveness of Evidence
c. Practitioner k. Compilation
d. True l. Agreed-upon procedures
e. Fair m. Auditing
f. Materiality o. Criteria
g. Assertion-based assurance report p. Reasonable Assurance
h. Disclaimer of Opinion

1. MATERIALITY An expression of the relative significance or importance of a particular

matter in the context of the financial statements as a whole.
2. PRACTITIONER A person employed to provide a particular service.
3. PERSUASIVENESS OF EVIDENCE Evidence that is generated internally is more
reliable when the related controls are effective.
4. TRUE Factual and conforming with reality. In conformity with relevant standards and
law and correctly extracted from accounting records.
5. REASONABLE ASSURANCE The fact that much of the evidence available to the
practitioner is persuasive rather than conclusive.
6. CRITERIA Benchmarks used to evaluate or measure the subject matter.
7. STEWARD A person employed to manage other people's property.
8. DISCLAIMER OF OPINION Unable to obtain sufficient appropriate audit evidence on
which to base the opinion.
9. FAIR Free from discrimination and bias and in compliance with expected standards
and rules. Reflecting the commercial substance of underlying transactions.
10. COMPILATION Applies accounting and financial reporting expertise to assist
management in the preparation and presentation of financial information.
11. ACCOUNTABLE Being required or expected to justify actions and decisions.
12. ASSERTION-BASED ASSURANCE REPORT In our opinion the responsible
party’s assertion that internal control is effective, in all material respects, based on XYZ
criteria, is fairly stated”.
EXERCISE 2
TRUE OR FALSE

1. FALSE The practitioner expresses reasonable assurance in a negative form of

opinion.
2. TRUE The practitioner must not issue an oral conclusion about a subject matter
based on the identified suitable criteria and the evidence obtained
3. TRUE Consulting services help enhance the credibility of the subject matter
information.
4. FALSE The objective of a reasonable assurance engagement is a reduction in
assurance engagement risk to an acceptably low level in the circumstances of the
engagement as the basis for a negative form of expression of the practitioner’s
conclusion.
5. TRUE Moderate level of assurance refers to the professional accountant having
obtained sufficient appropriate evidence to conclude that the subject matter conforms in
all material respects with identified suitable criteria.
6.TRUE In compilation, the practitioner expresses his or her conclusion on the subject
matter information.
7. FALSE A limited assurance engagement, the practitioner expresses either a positive
form of opinion or the negative form of opinion, depending on the circumstance.
8. FALSE Philippine Framework for Assurance Engagement provides a frame of
reference for the Auditing and Assurance Standards Council in its adoption of
International Standards on Auditing, International Standards on Review Engagements
and International Standards on Assurance Engagements for application in the
Philippines.
9. FALSE Assurance Engagement is a systematic process of objectively obtaining and
evaluating evidence regarding assertions about economic actions and events to
ascertain the degree of correspondence between those assertions and established
criteria and communicating the results to interested users.
10. TRUE Assertions are the representations of management as to the reliability of the
information system.