ACCA AA · Chapter 1 · Question 8 of 8
Consider the following engagements: 1. Statutory audit of annual financial statements 2. Review of interim financial statements under ISRE 2400 3. Agreed-upon procedures engagement on a list of payables Which of these engagements provides limited assurance?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: C) 2 only
Explanation
A statutory audit provides reasonable assurance. A review engagement provides limited assurance with a negative conclusion. An agreed-upon procedures engagement provides no assurance at all: the practitioner simply reports factual findings and the users draw their own conclusions.
More Audit and other assurance engagements MCQs
- Q2What level of assurance is provided by a statutory external audit of financial statements, and how is the conclusion expressed?
- Q3An accountancy firm has completed a review engagement on a client's interim financial statements under ISRE 2400. Which of the following…
- Q4Which of the following is an inherent limitation of an audit that explains why only reasonable, rather than absolute, assurance can be…
- Q5Which of the following beliefs held by some users of financial statements contributes to the 'expectation gap'?
- Q6In an audit of financial statements, who has primary responsibility for preparing the financial statements?