MODULE A
Other Public Accounting Services
LEARNING OBJECTIVES
Review Multiple Exercises, Problems,
Checkpoints Choice and Simulations
1. Explain and provide 1, 2, 3, 4, 5, 6 19,20, 23, 25, 44, 45, 61
examples of attestation 29, 35, 37, 38,
engagements. 40
2. Describe reviews, 7, 8 21, 22, 24, 27, 43, 46, 47, 48, 49, 51,
compilations, and 36, 41, 42 52
preparation of unaudited
financial statements and
prepare appropriate
reports given specific
factual circumstances.
3. Explain auditors’ 9, 10 26 53, 54
responsibilities related to
reporting on interim
financial information.
4. Define, explain, and give 11, 12, 13, 14, 28, 39 50, 55
examples of other special
, reports provided by 15
auditors, including
specified elements of
financial statements,
special purpose
frameworks and
application of
requirements of
appropriate financial
reporting frameworks.
5. Explain and provide 16, 17, 18 30, 31, 32, 33, 56, 57, 58, 59, 60
examples of assurance 34
services engagements.
SOLUTIONS FOR REVIEW CHECKPOINTS
,A.1 An attestation engagement is defined as “an engagement in which a practitioner is engaged
to issue or does issue an examination, a review, or an agreed-upon procedures report on
subject matter or an assertion about the subject matter that is the responsibility of another
party.” Attestation engagements include:
• Agreed Upon Procedures Engagements (AT 201)
• Financial Forecasts and Projections (AT 301)
• Reporting on Pro Forma Financial Information (AT 401)
• Reporting on an Entity’s Internal Control over Financial Reporting (AT 501)
• Compliance Attestation (AT 601)
• Management’s Discussion and Analysis (AT 701)
• Reports on Controls at Service Organizations (AT 801)
, A.2 A responsible party is the person at the client who is accountable for the information (e.g., the
client’s controller for financial information). The accountant should obtain written
acknowledgment or other evidence of the party’s responsibility for the subject matter or the
written assertion. The responsible party can acknowledge responsibility in a number of
ways, for example, in an engagement letter or a representation letter. If the accountant is not
able to directly obtain written acknowledgment, the practitioner should obtain other
evidence of the party’s responsibility for the subject matter (for example, by reference to
legislation, a regulation, or a contract).
A.1 Following are the differences among examinations, reviews and agreed-upon procedures:
• An examination is similar in substance to an audit. Accountants evaluate internal
controls and assess the risk of material misstatement, gather evidence in support of the
assertions, and render opinions that represent a high level of assurance.
• A review provides only a limited level of assurance. The procedures performed in a
review engagement are generally limited to making inquiries and performing analytical
procedures although the accountants may decide that other procedures are necessary.
• In an agreed-upon procedures engagement (discussed in more detail later in this
module), the client delineates exactly what procedures it wants the accountants to
perform. Therefore, the level of assurance provided by such an engagement varies
depending on the procedures requested.
A.4 Both an audit and a compliance engagement require the following:
• Adherence to professional standards that are themselves very similar regarding training
and proficiency, independence, due care, planning and supervision, and sufficient
competent evidence.
• Consideration of materiality.
• Consideration of inherent, control, and detection risk.
• Tests of controls when assessing control risk below the maximum.
• Audit procedures: audit of balances for financial audits, tests of compliance for
compliance work.
• Written management representation letters.
Other Public Accounting Services
LEARNING OBJECTIVES
Review Multiple Exercises, Problems,
Checkpoints Choice and Simulations
1. Explain and provide 1, 2, 3, 4, 5, 6 19,20, 23, 25, 44, 45, 61
examples of attestation 29, 35, 37, 38,
engagements. 40
2. Describe reviews, 7, 8 21, 22, 24, 27, 43, 46, 47, 48, 49, 51,
compilations, and 36, 41, 42 52
preparation of unaudited
financial statements and
prepare appropriate
reports given specific
factual circumstances.
3. Explain auditors’ 9, 10 26 53, 54
responsibilities related to
reporting on interim
financial information.
4. Define, explain, and give 11, 12, 13, 14, 28, 39 50, 55
examples of other special
, reports provided by 15
auditors, including
specified elements of
financial statements,
special purpose
frameworks and
application of
requirements of
appropriate financial
reporting frameworks.
5. Explain and provide 16, 17, 18 30, 31, 32, 33, 56, 57, 58, 59, 60
examples of assurance 34
services engagements.
SOLUTIONS FOR REVIEW CHECKPOINTS
,A.1 An attestation engagement is defined as “an engagement in which a practitioner is engaged
to issue or does issue an examination, a review, or an agreed-upon procedures report on
subject matter or an assertion about the subject matter that is the responsibility of another
party.” Attestation engagements include:
• Agreed Upon Procedures Engagements (AT 201)
• Financial Forecasts and Projections (AT 301)
• Reporting on Pro Forma Financial Information (AT 401)
• Reporting on an Entity’s Internal Control over Financial Reporting (AT 501)
• Compliance Attestation (AT 601)
• Management’s Discussion and Analysis (AT 701)
• Reports on Controls at Service Organizations (AT 801)
, A.2 A responsible party is the person at the client who is accountable for the information (e.g., the
client’s controller for financial information). The accountant should obtain written
acknowledgment or other evidence of the party’s responsibility for the subject matter or the
written assertion. The responsible party can acknowledge responsibility in a number of
ways, for example, in an engagement letter or a representation letter. If the accountant is not
able to directly obtain written acknowledgment, the practitioner should obtain other
evidence of the party’s responsibility for the subject matter (for example, by reference to
legislation, a regulation, or a contract).
A.1 Following are the differences among examinations, reviews and agreed-upon procedures:
• An examination is similar in substance to an audit. Accountants evaluate internal
controls and assess the risk of material misstatement, gather evidence in support of the
assertions, and render opinions that represent a high level of assurance.
• A review provides only a limited level of assurance. The procedures performed in a
review engagement are generally limited to making inquiries and performing analytical
procedures although the accountants may decide that other procedures are necessary.
• In an agreed-upon procedures engagement (discussed in more detail later in this
module), the client delineates exactly what procedures it wants the accountants to
perform. Therefore, the level of assurance provided by such an engagement varies
depending on the procedures requested.
A.4 Both an audit and a compliance engagement require the following:
• Adherence to professional standards that are themselves very similar regarding training
and proficiency, independence, due care, planning and supervision, and sufficient
competent evidence.
• Consideration of materiality.
• Consideration of inherent, control, and detection risk.
• Tests of controls when assessing control risk below the maximum.
• Audit procedures: audit of balances for financial audits, tests of compliance for
compliance work.
• Written management representation letters.
