中央财经大学会计专英语教程Chapter 14.pptVIP

Feature Topic Skepticism Applies to All Types of Engagements 14.1 Other Assurance Engagements Review and Compliance Services Many non-public companies have their financial statements reviewed or complied by a CPA, instead of having them audited. The standards for compilations and reviews of financial statements are called Statements on Standards for Accounting and Review Services (SSARS). Because review service and compilation services provide less assurance than audits, it is important that the accountant establish an understanding with the client, preferably in a written engagement letter. A review service engagement is designed to allow the accountant to express limited assurance that the financial statements are in accordance with GAAP. Review and Compliance Services Procedures Suggested for Reviews Obtain knowledge of the accounting principles and practices of the clients industry. Obtain knowledge of the client. Make inquiries of management. Perform analytical procedures. Obtain letters of representation. Requirements for Compilation In a compilation engagement, the accountant must do the following: Possess knowledge about the accounting principles and practices of the client’s industry. Know the client, the nature of the clients business transactions, accounting records, and employees; and the basis, form, and content of the financial statements. Maker inquiries to determine whether the clients information is satisfactory Read the compiled financial statements and be alert for any obvious omissions or errors in arithmetic and GAAP. Review of Interim Financial Information for Public Companies The object of an interim review is to provide the accountant with a basis for reporting to management, the board of directors, the shareholders, and others on significant matters found through inquiry and analytical procedures. Other Audits or Limited Assurance Engagements Debt Compliance Letters and Similar Reports Attestation Engagements. Types of attestations Engag