Kế toán, kiểm toán - Chapter twenty: Assurance, related services and internal auditing

Assurance, Related Services and Internal Auditing Chapter TwentyElliott Committee: Assurance Services Assurance services are independent professional services that improve the quality of information, or its context, for decision-makers.Decision-Making and the Role of InformationAssurance Services and IAASB Engagement StandardsIAASB: Assurance EngagementsAn engagement in which a practitioner expresses a conclusion designed to enhance the degree of confidence of the intended users other than the responsible party about the outcome of the evaluation or measurement of a subject matter against criteria. IAASB: Assurance EngagementsSubject matter and subject matter information.Criteria.Practitioner. Intended user.Responsible party.Assertion-based engagements. Direct reporting engagements.IAASB: Assurance EngagementsEthical requirements. Appropriate subject matter.Suitable criteria.Sufficient appropriate evidence.Practitioner’s conclusion in a written report.Reasonable or limited assurance. Conclusion in positive or negative form.Rational purpose.Assurance engagement risk is the risk that the practitioner expresses an inappropriate conclusion when the subject matter information is materially misstated. IAASB Assurance Standards and Assurance LevelReasonable assurance means that the engagement assurance risk is reduced to an acceptably low level in the circumstances of the engagement. In a limited assurance engagement the risk is greater than for a reasonable assurance engagement, but still acceptable in the circumstances of the engagement. The nature, timing and extent of procedures for gathering sufficient appropriate evidence in a limited assurance engagement are deliberately limited relative to a reasonable assurance engagement. IAASB Assurance Standards and Assurance LevelReview of Historical Financial InformationReview as an alternative to an audit.Review performed by the auditor of the entity, for example review of interim financial information.Historical financial information.Inquiries and analytical procedures.Limited assurance. Negative form of expression of the conclusion.Negative form of expression of the conclusion The review provides a basis to express a conclusion whether anything has come to the practitioner’s attention that causes the practitioner to believe that the financial information is not in accordance with the applicable financial reporting framework. Review Report – Unmodified ConclusionReview Report – Qualified ConclusionAssurance Engagements Other Than Audits and Reviews of Historical Financial InformationEthical requirements.Quality control.Engagement acceptance and continuance.Agreeing on the terms of the engagement.Planning and performing the engagement.Using the work of an expert.Obtaining evidence.Considering subsequent events.Documentation.Preparing the assurance report. Other reporting responsibilities.ISAE 3000 Establish procedural requirements for assurance engagements not covered by ISAs or ISREs.Basic elementsAssurance Report Compliance with the Kimberley ProcessAssurance Report Compliance with the Kimberley ProcessAssurance Report Compliance with the Kimberley ProcessAssurance Report on Internal Control IAASB Assurance ProjectsInternal ControlSustainabilityPro Forma Financial InformationGreenhouse GasOverview of Global Reporting Initiative (GRI) G3 Guidelines Assurance on Sustainability ReportingWhat type of information does sustainability reporting typically include? What are relevant criteria for reporting on sustainability? Why do companies report on sustainability? Why is third-party assurance of sustainability reporting demanded? What is relevant guidance for assurance on sustainability reporting? What is the role of practitioners as assurers of sustainability reporting? Assurance on Prospective Financial InformationFinancial forecasts are prospective financial information based on expectations of future events and actions. General useLimited useFinancial projections are prospective financial information based on hypothetical assumptions about future events and actions.Assurance on Prospective Financial Information(1) Evaluating the preparation.(3) Evaluating the presentation.(2) Evaluating the support of the underlying assumptions. (4) Issuing an assurance report. Related Services Related ServicesAgreed-Upon ProceduresCompilationISRS 4410ISRS 4400Provide NoAssuranceAgreed-Upon Procedures ReportAgreed-Upon Procedures Report (cont.)Compilation ReportInternal AuditingInternal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization’s operations.It helps an organization accomplish its objectives by bringing a systematic, disciplined approach to evaluate and improve the effectiveness of risk management, control, and governance processes.Institute of Internal Auditors (IIA) StandardsMandatory guidanceDefinition of internal auditingCode of ethicsStandardsStrongly recommended guidancePosition papersPractice advisoriesPractice guidesThe IIA oversees and sets standards for internal auditing internationally.IIA Code of Ethics PrinciplesIntegrityObjectivityConfidentialityCompetencyInternal Auditors’ Roles Evaluating Risks and ControlsReviewing ComplianceFinancial AuditingOperational AuditingInternal Audit FunctionInteractions between Internal and External Auditors Some of the work performed by internal auditors may be directly relevant to the work of the external auditor.Before a decision to use some of the work of internal auditors, the external auditor must evaluate the internal auditors’ objectivity and competence.End of Chapter 20