Attestation Engagements

Question 1

an examination, review, or agreed-upon procedures engagement performed under the attestation standards related to subject matter or an assertion that is the responsibility of another party.

Answer 1

Attestation Engagement

Question 2

For an Attestation Engagement, the CPA provides a written conclusion about…

Answer 2

an assertion that is another party’s responsibility

Question 3

An attestation engagement in which the practitioner obtains reasonable assurance by obtaining sufficient appropriate evidence about the measurement or evaluation of subject matter against criteria in order to be able to draw reasonable conclusions on which to base the practitioner’s opinion about whether the subject matter is in accordance with (or based on) the criteria or the assertion is fairly stated, in all material respects.

Answer 3

Examination Engagement

Question 4

An attestation engagement in which the practitioner obtains limited assurance by obtaining sufficient appropriate review evidence about the measurement or evaluation of subject matter against criteria in order to express a conclusion about whether any material modification should be made to the subject matter in order for it be in accordance with (or based on) the criteria or to the assertion in order for it to be fairly stated.

Answer 4

Review Engagement

Question 5

An attestation engagement in which a practitioner performs specific procedures on subject matter or an assertion and reports the findings without providing an opinion or a conclusion on it. The parties to the engagement (specified party) agree upon and are responsible for the sufficiency of the procedures for their purposes.

Answer 5

Agreed-Upon Procedures (AUP) Engagement

Question 6

consists of any financial information about the future. The information may be presented as complete financial statements or limited to one or more elements, items, or accounts.

Answer 6

Prospective Financial Information

Question 7

The objective of an Examination is to…

Answer 7

express an opinion

Question 8

The objective of a Review is to…

Answer 8

express negative assurance (nothing came to our attention that indicates information does not materially conform to criteria)

Question 9

In regards to an AUP Engagement, what are the auditor’s responsibilities in reference to an opinion & the level of assurance provided?

Answer 9

• No opinion is expressed
• No assurance is provided
• Lists the procedures performed and the findings from those procedures

Question 10

What are the auditor’s general standards required for attestation engagements?

Answer 10

T - Training & Proficiency
I - Independence
P - Professional Care

Question 11

What are the standards of fieldwork?

Answer 11

P - Planning & Supervision
I - Internal Control
E - Evidence

Question 12

What are the standards of reporting?

Answer 12

C - Consistency
D - Disclosures
O - Opinion
G - GAAP (MUST state whether the F/S have been prepared in accordance w/ US GAAP)

Question 13

What are the requirements of an AUP Engagement?

Answer 13

• CPA must be independent
• Responsible parties ensures procedures are adequate
• CPA & Responsible Party must agree on the procedures & criteria used
• Subject matter can consistently be reasonably measured
• CPA & Responsible Party must agree on materiality limits
• Use of the report is RESTRICTED to specific parties

Question 14

What is the additional requirement for an AUP Engagement when prospective financial information is used?

Answer 14

The report must include a summary of significant assumptions

Question 15

AUP Report:
Title Includes: __________
Identifies: __________
Conducted in accordance with: ____________
Disclaimer of Responsibility by: __________
Lists any _______ limits

Answer 15

Independence
Subject Matter
AICPA Attestation Standards
CPA
Materiality

Question 16

What is the opinion & assurance level associated with an AUP Engagement?

Answer 16

• Disclaim an Opinion

- State that NO negative assurance is given

Question 17

a statement that “there are no material modifications that should be made to the financial statements in order for the statements to be in conformity with the applicable financial reporting framework.”

Answer 17

Limited Assurance

Question 18

What type of assurance is issued in relation to a review of financial statements (AR-C 90.17) and in certain reports on a review of interim financial information.

Answer 18

Limited Assurance

Question 19

an auditor’s statement to the effect that the tested items are in compliance with applicable laws or regulations or agreement with specified standards.

Answer 19

Positive Assurance

Question 20

When may Positive Assurance be used?

Answer 20

It may be used in engagements involving compliance auditing of governmental entities and recipients of governmental financial assistance, as specified in Government Auditing Standards and the Single Audit Act of 1984.

Question 21

is a statement made by the auditor which says that, as a result of specified procedures, “nothing came to our attention which would indicate that specified matters do not meet a specified standard.”

Answer 21

Negative Assurance

Question 22

When is an auditor NOT allowed to express Negative Assurance?

Answer 22

As a general rule, auditors cannot use negative assurance when writing an attestation opinion on financial statements

Question 23

When is an auditor allowed to express Negative Assurance?

Answer 23

comfort letters, special reports, applying agreed-upon procedures, and certain reports on compliance with laws and regulations and with contractual agreements

Question 24

Negative assurances should never be used in a(n) ______________ .

Answer 24

Audit Report