A3 Attestation Engagements

Question 1

Attestation Engagements

Answer 1

These require an examination report, review, or an agreed upon procedures report on subject matter or an assertion about the subject matter, that is responsibility of a party other than the practioner.

Question 2

Statements on Standards for Attestation Engagements (SSAE)

Answer 2

These provide info that addresses services (review, AUP, examinations) for multiple matters. SSAE don’t apply to all services provided by the CPA. The standards are much broader in scope than GAAS & differ in terms of no reference being made to historical FS nor GAAP.

Question 3

Attestation Standards

Answer 3

These include guidance on concepts common to all attestation engagements using the mnemonic CAPE CORP

Compliance
Acceptance
Preconditions
Engagement
Change
Other Practioner
Responsibility
Professional Skepticism

Question 4

Attestation Risk

Answer 4

These risk can be represented by 3 components; IR, CR, DR

Attestation risk should be low

Question 5

Scope Restrictions

Answer 5

For examination engagements may result in qualified, disclaimer, or withdrawal.

Scope restrictions for review engagements is automatic withdrawal

Question 6

Assertion Based Examination

Answer 6

Assertion Based Examination report on a subject matter contains the title, intro, scope, independence requirements, inherent limitations, & emphasis of matters (both optional), & the opinion.

Question 7

Review Report

Answer 7

Review report on a subject matter contains the title, intro, scope, independence requirements, description of work performed, inherent limitations, emphasis of matter, & opinion. The same goes for a review on an assertion about a subject matter but this report is restricted use only.

Question 8

Written Assertion

Answer 8

There are no written assertions are provided by mgmt.

Question 9

Services Performed Under SSAE & SSARS

Answer 9

Attest engagements covered under SSAE specifically exlcude services performed in accordance with the statement on standards for accounting & review services (SSARS).

Meaning that a review of a nonpublic company’s FS is conducted with SSARS. However, reviews of pro forma FS, examinations of financial forecast or mgmt’s assertion about a subject matter are conducted under SSAE.