1.1 - Definition

Question 1

Define an assurance engagement

Answer 1

It is when a practitioner expresses a conclusion designed to enhance the degree of confidence of the intended users other than the responsible party about the outcome of the evaluation or measurement of a subject matter against criteria

Question 2

What are the five key elements of assurance engagements?

Answer 2

• three people or groups of people involved
• a subject matter
• suitable criteria
• sufficient appropriate evidence to support the assurance opinion
• a written report in appropriate form

Question 3

Three people or groups of people involved

Answer 3

• the practitioner (accountant)
• the intended users
• the responsible party (who prepared the subject matter)

Question 4

A subject matter

Answer 4

• data (e.g financial statements or business projections)
• systems or processes (e.g internal control / computer systems)
• behaviour (e.g social and environmental performance or corporate governance)

Question 5

A suitable criteria

Answer 5

Whoever provides the assurance must have something by which to judge whether the information is reliable and can be trusted - e.g auditor may use accounting standards

Question 6

Sufficient appropriate evidence to support the assurance opinion

Answer 6

The practitioner must substantiate the opinion that they draw in order that the user can have confidence that it is reliable

Question 7

A written report in appropriate form

Answer 7

Required that assurance reports are provided to the intended users in a written form and contain certain specified information