1 / 27

Assurance Services

Assurance Services. Independent professional services that “improve the quality of information, or its context, for decision makers” Assurance service encompass attestation services but are broader

baylee
Download Presentation

Assurance Services

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Assurance Services Independent professional services that “improve the quality of information, or its context, for decision makers” Assurance service encompass attestation services but are broader Attestation, a portion of assurance services, are restricted to examination, review or agreed-upon procedures engagements Assurance services go beyond attestation, may involve analyzing data or putting them in a form to facilitate decision making

  2. Relationship Between Assurance and Attestation

  3. Demand for Assurance Services Reduce information risk for outside parties and enable the company to contract at more favorable terms Information technology has significantly changed expectations of information users New services being developed Continuous auditing Assurance on system reliability Performed in accordance with Statement on Standards for Attestation Services

  4. Selected Characteristics of Assurance Services

  5. Subject Matter Historical or prospective performance or condition Physical characteristics Historical events Analyses Systems or processes Behavior

  6. Assertion Declaration about whether the subject matter is presented in accordance with certain criteria. Practitioners generally must obtain appropriate assertion about subject matter Report can be on either The assertion about the subject matter or The subject matter itself

  7. Criteria Suitable Objective Permit reasonable consistent measurements Complete Relevant Available Publicly available Presented in a summary, the assertion or the practitioners’ report

  8. Relationships Among Terms Used in Attestation Engagements

  9. Attestation Risk Risk that practitioners will unknowingly fail to appropriately modify their report on subject matter that is materially misstated Consists of Inherent risk Control risk Detection risk Materiality Difficult because subject matter may not be financial Determine likely needs of intended users

  10. Types of Attestation Engagements Examinations Highest level of assurance Attestation risk at low level Reviews Limited or negative assurance Attestation risk at moderate level Agreed-upon procedures Restricted use reports

  11. Examination Report

  12. Review Report on Subject Matter

  13. Assurance on Internal Control over Financial Reporting Presented in Chapters 7 and 18. Public companies—Performed as a part of the integrated audit covering financial statements and internal control. Nonpublic Companies—Have the option of having a similar integrated audit.

  14. Prospective Financial Statements Financial Forecasts Information about the entity’s expected financial position, results of operations and cash flows Financial Projection Expected results, given one or more hypothetical assumptions CPAs engaged to examine or perform agreed-upon procedures but no review

  15. Examinations of Prospective Financial Statements Practitioners gather evidence relating to the client’s procedures for preparation of the statements Evaluate the underlying assumptions Obtain a written representation letter from the client Evaluate whether statements are in conformity with AICPA guidelines

  16. Reporting on Prospective Financial Statements Report on subject matter States whether the statements are presented in conformity with AICPA guidelines Whether underlying assumptions provide a reasonable basis for the statements Does not vouch for the achievability of the forecast or projection

  17. Compliance Types 1. Attesting to an entity’s compliance with specified requirements of laws, regulations, rules, contracts, or grants. 2. Attesting to the effectiveness of an entity’s internal control over compliance with specified requirements.

  18. Management’s Discussion and Analysis Management required to provide narrative explanation of financial results as part of 10-K and 10-Q Practitioner may examine or review Objective to provide assurance on (1) the presentation includes, in all material respects, the required elements of the rules and regulations adopted by the SEC; (2) the historical financial amounts included in the presentation have been accurately derived, in all material respects, from the entity’s financial statements; and (3) the underlying information, determinations, estimates, and assumptions of the entity provide a reasonable basis for the disclosures contained in the presentation.

  19. Trust Services Intended to address user and preparer needs regarding issues of security, availability, processing integrity, online privacy and confidentiality within e-commerce and other systems System consists of Infrastructure Software People Procedures Data

  20. Trust Services The practitioner (1) performs procedures to determine that management’s description of the system is fairly stated and (2) obtains evidence that the controls over the system are designed and operating effectively to meet the Trust Services Principles and Criteria—the suitable criteria required for an attest engagement

  21. Principles and Criteria Principles 1. Security 2. Availability 3. Processing Integrity 4. Confidentiality 5. Privacy Criteria for each principle 1. Policies 2. Communications 3. Procedures 4. Monitoring

  22. Types of Trust Services Engagements Examination or agreed-upon procedures WebTrust Assurance on electronic commerce systems SysTrust Assurance on any system

  23. Reporting on Trust Services WebTrust and SysTrust reports are similar: Assurance is provided on management’s assertion relating to the principles SysTrust reports may be on one or more of the five principles Designed to incorporate a seal management process Seal (logo) included on a client’s website as electronic representation of the report Engagement must be updated at least annually to use the seal Initial reporting period must be at least 2 months

  24. PrimePlus/ElderCare Services Financial Goal setting, funding analysis, needs assessment Nonfinancial Interpersonal and relationship management Management of interaction between service providers and client Target market Older clients of CPA Children of older adults Other professionals that deal with older adults

  25. XBRL eXtensible Business Reporting Language is an international information format designed for business information. Accounting profession is in process of developing guidance for CPAs to provide assurance on XBRL-Related Documents.

  26. Additional Future Assurance Services Committees working on: Health care performance measurement This service provides assurance about the effectiveness of health care services provided by health maintenance organizations, hospitals, doctors, and other providers. Continuous auditing provides assurance using a series of reports provided simultaneously or shortly after the related information is released.

More Related