Professional Documents
Culture Documents
Attestation Services
- Provides assurance to its reliability
Attest Engagement
- A practitioner is engaged to issue or does issue an examination, a review, or an
agreed-upon procedures report on subject matter or an assertion about subject matter
that is the responsibility of another party (ex. management).
CPAs attest to many types of subject matter including financial forecasts, internal control,
compliance with laws and regulations, and advertising claims.
The CPAs may be engaged to report directly on the internal control and express an opinion
whether the company’s internal control over financial reporting follows certain standards.
Alternatively, they may report on an assertion made by the management that the company’s
internal control follows certain standards. In this case, the audit report would include an opinion
on whether the management’s assertion is accurate.
Attest Engagement
- Refers to report arising from 3 forms of engagement:
Examination (audit) - involves historical financial statements, provides highest for
of assurance that CPAs can offer.
- CPAs select from all available evidence a combinations
that limits to a low level the risk of undetected misstatement and
provides reasonable assurance that the subject matter is
materially correct.
Reviews-
Performance of agreed-upon procedures-
Auditors:
-gather evidences about transactions in the income statement
-addresses assertions on the management’s assets and liabilities
-considers whether the financial statement amounts are accurate,
properly-classified, summarized
-considers whether the notes are informative and complete
Reliable accounting and financial reporting and society in allocating resources in an efficient
manner.
The primary goal is to allocate limited capita resources to the production of goods and services
for which demand is great.
Inadequate accounting and reporting conceal waste and inefficiency, thereby preventing an
efficient allocation of economic resources.
“Audited” - means that the balance sheet and the statements of income, retained earnings, and
cash flows are accompanied by an audit report prepared by independent public accountants,
expressing their professional opinion as to fairness of the company’s financial statements.
Audit Categories:
1. Financial Audits
2. Compliance Audits
3. Operational Audits