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Questions and Answers
Which of the following statements best describes assurance services?
Which of the following statements best describes assurance services?
- Services designed for the improvement of operations, resulting in better outcomes.
- Services designed to express an opinion on the fairness of historical financial statements based on the results of an audit.
- The preparation of financial statements or the collection, classification, and summarization of other financial information.
- Independent professional services that are intended to enhance credibility of information to meet the needs of an intended user. (correct)
Which of the following is not an assurance service?
Which of the following is not an assurance service?
- Examination of prospective financial information
- Compilation of financial information (correct)
- Audit of historical financial statements
- Review of financial statements
What level of assurance is provided by the auditor in an audit engagement?
What level of assurance is provided by the auditor in an audit engagement?
- Moderate
- No assurance
- High, but not absolute (correct)
- Absolute
In an engagement, what is the purpose of the auditor's report?
In an engagement, what is the purpose of the auditor's report?
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What is the main goal of assurance services?
What is the main goal of assurance services?
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Study Notes
Assurance Services
- Assurance services are professional services that improve the quality of information for decision-makers
- Assurance services provide independent professional judgment about the subject matter, enhancing the degree of confidence of intended users
Types of Assurance Services
- Audit engagements provide high level of assurance, while review engagements and agreed-upon procedures provide lower levels of assurance
Auditor's Report
- The purpose of the auditor's report is to provide an opinion on the fairness and accuracy of the financial statements
- The auditor's report is intended to enhance the degree of confidence of intended users in the financial statements
Goals of Assurance Services
- The main goal of assurance services is to enhance the degree of confidence of intended users in the subject matter
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