What is an example of reasonable assurance engagement?

What is reasonable assurance engagement?

The NGER Audit Determination definition of a reasonable assurance engagement is: ‘an assurance engagement in which the audit team leader gives an opinion, expressed as a reasonable assurance conclusion, if appropriate in the circumstances of the engagement’.

What is considered an assurance engagement?

“Assurance engagement” means an 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.

What are types of assurance engagement?

Types of assurance engagement

  • External Audits. An Auditor states an opinion as to whether the financial statements Give a true and fair view. …
  • Review engagements. The auditor reviews the financial statements using less evidence than required by an audit.

What do you mean by reasonable assurance?

Reasonable assurance includes the understanding that there is a remote likelihood that material misstatements will not be prevented or detected on a timely basis. Although not absolute assurance, reasonable assurance is, nevertheless, a high level of assurance.

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What are the five elements of an assurance engagement?

The five elements of an assurance engagement

  • A three-party relationship, involving: the practitioner, a responsible party and intended users.
  • Appropriate subject matter.
  • Suitable criteria.
  • Sufficient, appropriate evidence to support the conclusion.
  • A conclusion contained within a written report.

What are the two levels of assurance?

There are two common levels of assurance engagements that audit firms normally offer and provide. First is the reasonable assurance and second is limited assurance engagement. Reasonable assurance normally express in the positive form. It is sometimes called positive assurance.

What are the two types of assurance engagement?

What Are Some Examples of Assurance Engagements? There are two primary examples of assurance engagements. These include external audits and review engagements. Both of these differ from each other due to the level of assurance that auditors or practitioners provide.

What are the types of assurance?

Types of assurance

  • Procurement and tendering. Procurement and tendering processes must be robust and fair to all the parties involved, such as contractors, consultants, and purchasers. …
  • Contract management. …
  • Probity. …
  • Managing projects. …
  • Managing risks. …
  • Managing assets. …
  • Governance. …
  • Information systems.

Who sets the criteria of an assurance engagement?

Conclusion. An assurance engagement involves an assignment performed by a practitioner to express an opinion about a subject matter. Usually, the practitioner examines the subject matter against given criteria. There are 5 elements that are crucial to any assurance engagement.

What are the limitations of assurance engagement?

These limitations include: Financial information includes subjective and judgemental matters. Inherent limitations of controls used as audit evidence. Representations from management may have to be relied upon as the only source of evidence in some areas.

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What are the three phases of the assurance engagement process?

The three phases of the assurance engagement process are planning, performing, and communicating. 3. The steps included in the planning phase of an assurance engagement are: • Determine engagement objectives and scope.

How do you get reasonable assurance?

To achieve reasonable assurance, the auditor needs to obtain sufficient appropriate audit evidence to reduce audit risk to an acceptably low level. This means that there is some uncertainty arising from the use of sampling, since it is possible that a material misstatement will be missed.

What is reasonable assurance of employment?

“Reasonable Assurance” is an unemployment insurance term that indicates a school employee has a contract (written or implied) that indicates they will likely be employed for the following school year, term, or remainder of a school term.

What percent is reasonable assurance?

What percentage is reasonable assurance? If assurance were represented as the degree of confidence in the audit opinion, then a range of 90–99 percent confidence, with 95 percent being the most common, would be normal. Reasonable assurance is closely related to the concepts of audit risk and materiality.