Exam 20: Other Assurance and Nonassurance Services

Four different engagements that the auditor can complete are compilation,bookkeeping,audit,and review.Rank these engagements with respect to the level of assurance provided from highest assurance level to lowest assurance level.

Which of the following matters would be addressed in a report on the results of applying specified auditing procedures to financial information other than financial statements?

An accountant who reviews the financial statements of an entity should issue a report stating that a review

A public accounting firm can issue a compilation report

Define "direct reporting engagements."

For the conduct of an assurance engagement,the practitioner is required to identify or develop criteria to evaluate the subject matter.Identify some characteristics of suitable criteria.

Before performing a review of an entity's financial statements,an accountant should

The accountant is working on an engagement with respect to the client's financial statements.Which of the following engagements would omit an assessment of the client's accounting policies' compliance with GAAP?

List the financial statement users and the suitable engagements that auditors perform for them.

Performing inquiry,analytical procedures,and discussion with the limited objective of assessing whether the information being reported on is plausible within the framework of appropriate criteria is the definition of a(n)

Outline the three performance standards of "Standards for Assurance Engagements."

Which of the following components of an engagement letter would apply to both a review engagement and a compilation engagement?

Which of the following engagements would most likely be a compilation engagement?

The statement that "nothing came to our attention that would indicate that these statements are not fairly presented" expresses which of the following?

Which of the following would be required in a compilation?

"An engagement where the practitioner expresses a conclusion on a written assertion about a subject prepared by a party accountable for the assertion,such as management" is the definition of a(n)

"An engagement where there is an accountability relationship between two or more parties and the practitioner is engaged to issue a written communication expressing a conclusion about subject matter for which the accountable party is responsible" is the definition of a(n)

Leon Levy,a partner at the audit firm where you work,asked you to work on the audit of the balance sheet of Geminy Corp.Geminy is not a public company and has not been required to have audited financial statements in the past.This year,due to a new bank loan,its bank requested that audited financial statements be provided.Who are the primary users in this assurance engagement?

Sean Clem has done a review engagement and prepared the tax return for your web design business for the last five years.The books and records have always been well organized,although year-end adjusting entries have been required.You do some of the accounting yourself and the rest of the accounting records are handled by your spouse,who is also an employee of the business. This year,you would like to expand your business to provide ISP (internet service provider)services to your clients.This would involve purchasing additional computer equipment and software.You are also considering hiring an additional employee (you currently have three),and you are looking at obtaining a loan for $100 000 from the bank.The bank says that you should have your records audited,but you are not sure what this will mean. Required: What would Sean say to you about the differences between an audit and a review?

With respect to working on an engagement to examine a financial forecast or projection included in a prospectus or other public offering document,the public accountant and the client should agree upon