CA Final · Advanced Auditing, Assurance and Professional Ethics · Related Services

A bank asks CA Anil, the statutory auditor of Gomti Foods Ltd, to perform specified procedures on the company's receivables ledger and report what he finds. The bank will draw its own conclusions from his findings. Which view is correct under SRS 4400?

Anil may accept it as an agreed-upon procedures engagement under SRS 4400, reporting factual findings for the bank to use. The standard's footnote clarifies that the person performing the engagement need not be the auditor of the entity's financial statements, and nothing prevents the statutory auditor from doing it.

AAnil may take this on as an agreed-upon procedures engagement on financial information, and he need not be the auditor of the entity's financial statements to do soCorrect
BAnil cannot accept the engagement because he is the statutory auditor and agreed-upon procedures are barred for him
CAnil must express a true and fair opinion on the receivables ledger
DOnly a person who is not the statutory auditor can perform such an engagement

Explanation

SRS 4400 sets standards for an auditor's responsibilities in an agreed-upon procedures engagement on financial information. Its footnote says the term auditor does not imply that the person performing related services must be the auditor of the entity's financial statements. Nothing bars the statutory auditor, so the barred-auditor option is wrong.

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A bank asks CA Anil, the statutory auditor of Gomti Foods Ltd, to perform specified procedures on the company's receivables ledger and report what he finds. The bank will draw its own conclusions from his findings. Which view is correct under SRS 4400?

Explanation

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