Assurance & Audit

Question 1

What level of assurance is given to an Audit of Financial Information?

Answer 1

Assurance type: Reasonable
Assurance level: High
Opinion: Positive

Question 2

What level of assurance is given to an Review of Financial Information?

Answer 2

Assurance type: Limited
Assurance level: Moderate
Conclusion: Negative

Question 3

Under ISA 200 what are the Objectives of an Audit? (3)
ORC

Answer 3

1. Obtain reasonable assurance whether the FS are free from MM, properly prepared in line with FRF.
2. Report on FS
3. Communicate with those charged with governance.

Question 4

What are the answers to these questions in a Statutory Audit…
Report to:
Scope determined by:
Reporting:
Level of assurance:
Circulation of report:

Answer 4

Shareholders.
CA06, ISAs, audit regulations.
Express opinion on:
1. FS (true&fair,properly prepared)
2. Other matters
Reasonable.
Public domain once accounts filed.

Question 5

What are the answers to these questions in an Other assurance…
Report to:
Scope determined by:
Reporting:
Level of assurance:
Circulation of report:

Answer 5

Usually management.
ToE, ISAEs or ISREs.
Conclusion.
Usually limited.
Likely to be restricted.

Question 6

What are the benefits of an Audit?

Answer 6

1. Independent scrutiny by experts.
2. Additional assurance for 3rd parties.
3. Growing business > Audit.
4. Subsidiary benefits.

Question 7

What is the role of the FRC? (3)

Professional Standards

Answer 7

1. Supervise accountancy related issues in the UK.
2. Issues ISAs.
3. Issues standards for auditors:
   - ethical standards
   - practice notes
   - bulletins
   - standards for reviews of IFS
   - audit quality - thematic reviews

Question 8

What are the current issues to consider regarding professional standards in an Audit? (6)

HBTJCT

Answer 8

Harmonization.
Big data.
The future of audit.
Joint audits.
Climate change / sustainability.
Technological advances.

Question 9

What are the IFRS disclosure standards regarding Sustainability?

Answer 9

IFRS S1 General requirements for disclosures of sustainability-related FI.

IFRS S2 Climate-related disclosures.

Question 10

IFRS S1 General requirements for disclosures of sustainability-related FI.

Answer 10

Entities must disclose significant sustainability-related risks and opportunities.

Question 11

IFRS S2 Climate-related disclosures.

Answer 11

Entities must disclose climate-related risks and opportunities.