Concept of and need for Assurance

Question 1

Are assurance services required by law?

Answer 1

For all companies that are not small companies (Companies Act 2006)

Question 2

What are the five elements of an assurance engagement

Answer 2

Three party relationship
Subject matter
Suitable Criteria
Sufficient appropriate (audit) evidence
Written report

Question 3

What are the limitations of an assurance service?

Answer 3

1. Subjective exercise
2. Sampling
3. Limitations in systems
4. Limitations in report
5. Information from third parties
6. Estimations

Question 4

True or False:

Reasonable assurance is a high level of assurance?

Answer 4

True!

Reasonable assurance is also a positively expressed opinion