Assurance - Review & Compilation Engagement

Question 1

Explain what a review engagement & the standard to use

Answer 1

Review Engagement is design for entities to not need an audit opinion but still require some level of assurance

• review engagement provides limited assurance
• CSRE 2400, CSQM 1, CSQM 2

Question 2

What are the consideration to accept a review engagement

Answer 2

1. Performance acceptance and continuance procedures
2. Determine materiality
3. Obtain an understanding of the entity
4. Design procedures

Question 3

What are the indicators that prevent the acceptance of review engagement

Answer 3

• Indicators that prevent acceptance
• Rationale purpose, appropriateness, Ethics, Scope limitation
• Subject to some independence of audit
• Management ensure acceptance FRF
• Management Integrity

Question 4

How is materiality determined

Answer 4

For the F/S as a whole, apply materiality, design procedures
- Must be revise if information is obtain that affects materiality
- Must be able to identify areas of materiality of material misstatement
- Analytical procedures must be design to obtain SAE must address all item

Question 5

What are the four steps for execution consideration

Answer 5

1. Perform, supervise, review work performed
   - Inquiry is asking questions of another knowledgeable party. Typically be management or another person within the entity
2. Evaluate the appropriateness and sufficiency of evidence obtain
   - Practitioner evaluates whether SAW has been obtain and perform additional procedures as neccessary to conclude on F/S
3. Design additional procedures where statements may be materially misstatement
4. Document result of work performed and consideration reach
   - CRSE 2400 - requires documentation prepared review that provides evidence that review was performed in accordance with legal and regulatory requirement
   Client of engagement understand - Nature, timing and extent of procedures, Result obtain from procedures, practitioner conclusion, significant matters

Question 6

What is the reporting and conclusion consideration

Answer 6

• Practitioner about whether the practitioner attention that cause practitioner to believe F/S is not prepared in applicable FRF
• Subsequent event, communication, obtain manager representation such as , review inquiries, firm approval

Question 7

Explain what a compilation engagement

Answer 7

• Requires standard for practitioner when compiling financial information
• No opinion is provided, compilation engagement report is provided
• CSRS 4200 - Assisting management in preparation of compiled financial information in accordance with financial information
• Does not require practitioner to verify of procedures for accuracy or completeness of information

Question 8

What compilation standard is used for acceptance and planning

Answer 8

CRSR 4200.22
a. making inquires of management regarding intended use of compiled financial information including whether information to be used for third parties
b. Obtain acknowledge from management of basis of accounting expected to be applied preparation of compiled financial information

Question 9

What standard is used for the execution of the compilation engagement

Answer 9

CSRS 27-33
1. Practitioner knowledge - Business operation, accounting system and records, basis of accounting to be applied
2. Management communication - Practitioner to disclose any judgement that practitioner assisted on which management
3. Documentation - .39 - Practitioner prepares documentation of judgement, previous connection to engagement

Question 10

What is needed for the conclusion of the compilation engagement

Answer 10

1. Title
2. Addressee
3. Statement on basis of information provided by management
4. Identification of financial information has been subject to compilation
5. Date of compiled information
6. Reference to nature of compiled information
7. Management responsibilities
8. Practitioner Responsibilities