A5 Flashcards
When reporting on a review of pro forma financial information - it should include a reference what?
Referenced to the FS from which the historical information is derived and a statement as to whether the FS were audited or reviewed
What assertion is included when reporting on internal control over compliance?
A disclaimer of opinion on internal control over compliance (audit was conducted to express opinion on compliance but not purpose of expressing opinion)
What is a Type 1 report?
Report on the Design and implementation of controls at a service organization (in the report - will disclaimer of opinion regarding operating effectiveness)
What is a Type 2 report?
Report on the Design, Implementation, and operating effectiveness of controls at a service organization
What should the auditor do if the service auditor is unable to obtain a written assertion from the service organization management regarding suitability of Design and operating effectiveness of controls?
Withdraw from the engagement unless prohibited by law
What is a presumptively mandatory requirement and what standards use it to describe professional requirements?
Definition: requirement must be followed in all cases where the requirement is relevant, EXCEPT in rare circumstances in which auditors which auditors determine it is necessary to depart (“should”)
If an auditor is engaged to issue a report on a client’s compliance with contractual agreements or regulatory requirements in connection with a FS audit - what type of opinion is required on the FS audit and what type of assurance is expressed over compliance?
Auditor must have issued an unmodified or qualified opinion on the FS audit
Negative assurance over the compliance
What is the objective of a practitioner’s examination procedures applied to an entity’s compliance requirements?
Objective is for the practitioner to accumulate sufficient evidence regarding entity’s compliance for the practitioner to issue an opinion with reasonable assurance.
In a governmental audit - what is required regarding internal controls?
Required written report on internal control in every audit
What are the two reporting responsibilities under GAGAS?
- Reports on compliances with laws, rules, and regulations, violations which may affect financial statement
- Reports on internal control over financial reporting
What kind of assurance does a GAGAS audit provide in comparison to a GAAS audit?
Greater assurance
What condition must be met in order for a practitioner to perform an AUP on projected financial statements?
Can perform AUP on projected FS only when the projected FS include a summary of significant assumptions
What statement is required to be added when reporting on prospective Financial statements?
Statement indicating that the prospective results may not be achieved
What statement should be included in an accountant’s compilation report on a financial forecast?
Include statement there will be differences between forecasted and actual results
What are the 4 objectives of an examination of a financial forecast?
- Evaluating the preparation of the prospective financial statements
- Evaluating the support underlying the assumptions
- Evaluation the presentation of prospective FS in conformity with AICPA guidelines
- issuing examination
