Assurance and Non-
Assurance Services

Audit-Related Services

Review Financial Statement

provides a moderate level of
assurance

Objective

enable the Chartered Accountant to state whether, in all material respects, the financial statements are prepared in accordance with an identified financial reporting framework

General Principles

comply with the “Code of Ethics for
Professional Accountants”

plan and perform the review with an attitude of
professional skepticism

auditor should obtain sufficient evidence through
inquiry and analytical procedures to be able to draw conclusion

Terms of the Engagement

clear understanding between the client and the auditor regarding the engagement

Procedures

a. Obtain an understanding of the entity’s business and the industry in which the entity operates

b. Obtain understanding of the accounting systems and the nature of the entity’s assets, liabilities, revenues and expenses

c. Inquires of the entity’s personnel responsible

d. Inquire about the actions taken at meetings

e. Perform analytical procedures

f. Read financial statement to determine if they conform to identified financial reporting framework

g. For every balance sheet items, perform certain level of audit technique

h. If appropriate, obtain written representations from managemen

Agreed upon procedures

Objective : to report on factual finding and no assurance is expressed

General Principles : comply with the “Code of Ethics for
Professional Accountants”

Procedures

Inquiry and analysis

Re-computation, comparison, and other clerical accuracy clerk

Observation, Inspection and obtaining confirmation

Depends on what has been agreed with client

Compilation of financial information

objective

accountant to use accounting expertise, as opposed to auditing expertise,

collect, classify and summarize financial information, produce a report and no assurance is expressed

General Principles

comply with the “Code of Ethics for Professional Accountants”

Integrity, objectivity, professional competence, due care, confidentiality, professional behavior and technical standards

Terms of the Engagement

clear understanding between the client and the accountant regarding the terms of engagement.

Procedures

Obtained general knowledge of the business

Obtained knowledge about the accounting policies and practices of the industry

A general understanding of the nature of the entity’s business transactions, the form of its accounting records and the qualifications of its accounting personnel

The accounting basis on which the financial statements are to be presented

The accountant should obtain an acknowledgment from management of its responsibility

Other Assurance and Non-Assurance Services

Internal Auditing

independent appraisal function established within an organization to examine and evaluate its activities

Consultation

Management Consultation to client verbally or in writing

Consultancy in public offering of stock, Acquisition of a company, Venture into new business

Secretarial Services

Provide secretarial services to clients, Incorporation of new company, Deregistration of company

Taxation

Compilation of return (on behalf of client), tax planning, advise client on new changes

Accounting

Analyze the financial information and comparing to
budget, previous year and for unfavorable differences

financial forecast and projection

Financial forecasts means prospective financial information prepared based on the assumptions as to future events which management expects to take place

Financial projections means prospective financial information prepared to the best of responsible party’s knowledge and believe

auditor, before accepting the engagement would consider

competency in undertaking task and the client business

intended use of the information

Whether the information will be for general or limited distributions

nature of the assumptions, that is best-estimate or hypothetical assumptions

Reporting consideration

Unmodified Opinion

When the auditor believes that presentation and disclosure of the prospective financial information is adequate

Modified Opinion

When the auditor believes that presentation and disclosure of the prospective financial information is NOT adequate

Due Diligence Audit

process of enquiry and investigation made
on behalf of a prospective buyer

Auditor

required to understand the client’s need, to avoid
wrong audit procedures carried out

Procedures

Review the working papers of previous auditors

Evaluate the valuation of the assets of the company

Review Income Statement to determine accuracy of profits

Carry out analytical review and discuss unusual items

Verify all material items in the balance sheet

Review litigation issues, contingent liabilities, commitments

Forensic audit/Investigation

Often conducted to obtain or develop information as legal evidence

Required to report to the company that has appointed him/her in the case of a regulatory body

Stage of Audit

  1. Instruction from client
  1. Communicating with the auditors
  1. Assessing the aims and probable scope of the investigations
  1. Obtaining background information
  1. Deciding the outline of the audit report