Question

In Canada, practitioners follow the standards in the CPA Canada Handbook – Assurance for audit and other assurance services. These include Canadian Auditing Standards (CASs), which have been adopted from International Standards on Auditing (ISAs), with some amendments.

The CASs are issued by the Auditing and Assurance Standards Board (AASB), who also issues other pronouncements and non-authoritative material included in the CPA Canada Handbook – Assurance. The CASs only apply to all audits of financial statements for all types of entities. Other Canadian standards issued by the AASB in the CPA Canada Handbook are the Canadian Standards on Quality Control (CSQC) and Other Canadian Standards (OCS). There are several different types of assurance engagements other than an audit of financial statements discussed below.

describe "in your own words"

Related Services -Agreed upon Procedures Regarding Internal Control over Financial Reporting

     (9110)

the general purpose of the engagement

the auditor's responsibilities under each for accepting the engagement

type of assurance provided (1 mark)

Answer 1

Section 9110, Agreed-upon Procedures regarding Internal Control over Financial Reporting.

1) General purpose of the engagements

The purpose of this engagement is solely to assist those charged with governance, those having oversight responsibility for the financial reporting process, or management in assessing the design, implementation or operating effectiveness of the entity’s internal control over financial reporting.

Section 9110, Agreed-upon Procedures regarding Internal Control over Financial Reporting, establishes standards and provides guidance on the public accountant's professional responsibilities in conducting an agreed-upon procedures engagement regarding internal control over financial reporting and on the form and content of the report that the public accountant issues in connection with such an engagement. This Section may also serve as guidance for engagements to perform agreed-upon procedures related to other aspects of an entity's system of internal control.

This Section does not apply to engagements to report on an entity’s internal control over financial reporting to external parties who are not in a position to determine whether the agreed-upon procedures are sufficient and appropriate (such engagements should be done in accordance with section 5025)

2) Auditor Responsibility

1. The engagement is adequately planned

2. The engagement is conducted and the report of findings prepared with due care and with an objective state of mind

3. The assistants employed on the engagement are properly supervised

4. The procedures specified by the client cannot be overly subjective; the agreed-upon procedures should result in observable outcomes such that if another accountant reperformed the procedures, they would observe similar outcomes.

3) Type of assurance provided

1. No assurance or opinion is provided on the design, implementation or operating effectiveness of the entity’s internal control over financial reporting.

2. Only perform procedures requested by the client.

3. The public accountant and assistants should have adequate technical training and proficiency.