Chapter 19 Assignment Questions Flashcards
Procedure:
The accountant should establish an understanding with the entity regarding the nature and limitations of the services to be performed.
Is this required on a review engagement and/or a compliation engagement?
Review: Yes
Compilation: Yes
Procedure:
The accountant should make inquiries concerning actions taken at the board of directors’ meetings.
Is this required on a review engagement and/or a compliation engagement?
Review: Yes
Compilation: No
Preocedure:
The accountant should obtain a level of knowledge of the accounting principles and practices of the entity’s industry.
Is this required on a review engagement and/or a compliation engagement?
Review: Yes
Compilation: Yes
Procedure:
The accountant should obtain an understanding of the entity’s internal control.
Is this required on a review engagement and/or a compliation engagement?
Review: No
Compilation: No
Procedure:
The accountant should perform analytical procedures designed to identify relationships that appear to be unusual.
Is this required on a review engagement and/or a compliation engagement?
Review: Yes
Compilation: No
Procedure:
The accountant should send a letter of inquiry to the entity’s lawyer to corroborate the information furnished by management concerning litigation.
Is this required on a review engagement and/or a compliation engagement?
Review: No
Compilation: No
Procedure:
The accountant should obtain a management representation letter from the entity.
Is this required on a review engagement and/or a compliation engagement?
Review: Yes
Compilation: No
Procedure:
The accountant should make inquiries about events subsequent to the date of the financial statements that would have a material effect on the financial statements.
Is this required on a review engagement and/or a compliation engagement?
Review: Yes
Compilation: No
Procedure:
The accountant should perform a physical examination of inventory.
Is this required on a review engagement and/or a compliation engagement?
Review: No
Compilation: No
You have been asked to provide assurance on information contained in New Dominion’s Corporate Sustainability Report. What standards would you use to perform this engagement?
In response to a request to provide assurance on information contained in New Dominion’s Corporate Sustainability Report, the accountant would conduct the engagement in accordance with ____________. However, as Canada plans to adopt ____________, many practitioners are using that standard for these types of engagements. The practitioner would most likely be engaged to conduct ____________ level attestation engagement whereby the practitioner would issue an opinion on the presentation of management’s assertions about compliance with specific sustainability criteria. Distribution of the accountant’s report would be ____________.
Fill in the blanks
In response to a request to provide assurance on information contained in New Dominion’s Corporate Sustainability Report, the accountant would conduct the engagement in accordance with OCS 5025. However, as Canada plans to adopt
IASE 3000, many practitioners are using that standard for these types of engagements. The practitioner would most likely be engaged to conduct an examination level attestation engagement whereby the practitioner would issue an opinion on the presentation of management’s assertions about compliance with specific sustainability criteria. Distribution of the accountant’s report would be unrestricted.
What are the standards for compilation engagements?
- The services should be completed by a chartered public accountant who is properly licensed by a provincial government.
- The services should be performed by a person who has the proper technical training and proficiency in accounting and with due care.
- The public accountant must provide a certain level of assurance when preparing and issuing a review report.
- The work should be adequately planned and properly performed and, if assistants are employed, they should be properly supervised.
(Select all that apply)
- The services should be performed by a person who has the proper technical training and proficiency in accounting and with due care
- The work should be adequately planned and properly performed and, if assistants are employed, they should be properly supervised.
Why do the standards differ from review engagements and audits?
The difference between compilations and audit and review engagements is that there is ____________ provided in the compilation engagement and the work is ________ to compiling information; the general standard for review engagements and audits requires proficiency in __________________
The difference between compilations and audit and review engagements is that there is no assurance provided in the compilation engagement and the work is limited to compiling information; the general standard for review engagements and audits requires proficiency in
conducting reviews
Which level of assurance is this?
The practitioner provides a conclusion in a positive form. In this type of report, the practitioner makes a direct statement as to whether the presentation of the assertions, taken as a whole, conforms to the applicable criteria. The level of assurance is high.
Audit
Which level of assurance is this?
The practitioner provides a conclusion in the form of a negative assurance. In this form, the practitioner’s report states whether any information came to the practitioner’s attention to indicate that the assertions are not presented in all material respects in conformity with the applicable criteria. The level of assurance is limited.
Review
Which level of assurance is this?
The practitioner presents, in the form of financial statements, information that is the representation of management without undertaking to express any assurance on the statements.
Compilation Engagement
