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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Audit-related and assurance services

Brightwater Utilities publishes an integrated report. The directors ask the assurance provider to confirm the report meets the criteria. Before accepting the engagement under ISAE 3000 (Revised), which matter must the practitioner be satisfied about regarding the criteria used to prepare the report?

The practitioner must be satisfied the criteria are suitable and available to the intended users. ISAE 3000 (Revised) requires criteria that are relevant, complete, reliable, neutral and understandable. They need not be regulator-issued, identical to competitors' criteria, or merely approved by the audit committee.

  1. AThat the criteria are suitable and will be available to the intended usersCorrect
  2. BThat the criteria are issued by a statutory regulator
  3. CThat the criteria are identical to those used by the entity's competitors
  4. DThat the criteria have been approved by the audit committee only

Explanation

ISAE 3000 (Revised) requires the underlying subject matter to be appropriate and the criteria to be suitable, meaning relevant, complete, reliable, neutral and understandable, and available to intended users. Criteria need not come from a regulator or match competitors. Audit committee approval alone does not make criteria suitable.

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