Attestation Engagements and Standards

Question 1

A financial projection can be included in a document with audited financials. True or False?

Answer 1

True. The compilation report would also be included with the document to make clear that the practitioner does not express an opinion, a conclusion, nor provides an form of assurance.

Question 2

If one or more criteria or assumption was not provided during the agreed-upon procedures, what opinion will the auditor issue?

Answer 2

An adverse opinion. If guidelines were not followed, significant assumptions not disclosed, basis not reasonable or there is a scope limitation then the auditor would issue an adverse opinion.

Question 3

In a report about agreed-upon procedures, what should be included?

Answer 3

It should include a description of the the procedures performed by the CPA.

Question 4

For prospective reports, the accountant should include verbiage that the financial forecast may or may not be achieved?

Answer 4

May not. Report should always include the caveat that the results may not be achieved.

Question 5

Distribution of prospective reports should be for limited or general use?

Answer 5

Limited. Because they are hypothetical due to the assumptions made by management.

Question 6

In compilation reports, the accountant should make sure that management is responsible for the prospective financial statements. True or False?

Answer 6

True.

Question 7

Which prospective financial statement would be appropriate for general use.

Answer 7

A financial forecast not a projection is ok for general use.

Question 8

Attestation engagements pertain to what areas or subjects. (6)

Answer 8

1. Agreed upon procedures
2. financial forecasts and projections
3. Proforma financial statements
4. Compliance
5. MD&As
6. reporting on controls at service organization