Skip to content

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

CA Nisha is compiling financial statements for Orion Enterprises. Management asks that the report say the practitioner verified the accuracy and completeness of the information supplied, to satisfy a vendor. Under the illustrative compilation report in SRS 4410 (Revised), what is the correct course?

The practitioner should refuse. The compilation report states that accuracy and completeness of the information is management's responsibility and that, because compilation is not an assurance engagement, the practitioner is not required to verify it, so a verification claim would misrepresent the engagement.

  1. ARefuse, as the report states the practitioner is not required to verify accuracy or completeness and that these are management's responsibilityCorrect
  2. BAgree, as verification wording enhances the report
  3. CAgree, provided the fee is increased
  4. DAgree, provided the report is addressed to the vendor instead of management

Explanation

The illustrative report says the statements and the accuracy and completeness of the information used are management's responsibility, and that as compilation is not an assurance engagement the practitioner is not required to verify it. Adding verification wording would contradict the nature of the engagement.

Did you get it right without looking?

One question tells you little. A timed set on Related Services shows your real accuracy, how long you take and where you lose marks.

Practise Related ServicesFree diagnostic mock

More Related Services questions