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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Specific assignments

Calder Retail's directors have published an integrated report. The assurance provider is asked to give assurance over the whole report, including forward-looking statements about strategy and targets. Which approach is most appropriate?

The provider should agree a defined scope with the client, accepting that forward-looking information is inherently uncertain so assurance is usually limited and applied to specific elements. Reasonable assurance over targets is unrealistic, and ISA 700 applies only to audits of financial statements.

  1. AGive reasonable assurance on all forward-looking statements, since they are management's opinions
  2. BRefuse the engagement because integrated reports can never be assured
  3. CApply ISA 700 to the whole report as it contains financial information
  4. DAgree the scope with the client, recognising that future-oriented information is inherently uncertain and that the assurance will generally be limited and specific to defined elementsCorrect

Explanation

Integrated reports mix financial and non-financial, historical and forward-looking information. Assurance is usually scoped to defined elements, with limited assurance common for uncertain future-oriented items. Reasonable assurance on forecasts is not realistic, and ISA 700 applies only to financial statement audits.

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