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CA Final · Advanced Auditing, Assurance and Professional Ethics · Sustainable Development Goals (SDG) & Environment, Social and Governance (ESG) Assurance

Harit Power Ltd engages CA Rohan to perform a limited assurance engagement on its GHG emissions statement under the framework of SSAE 3410 (as adopted by ICAI). Management asks that the report give the same level of comfort as a financial statement audit but with fewer procedures to save fees. What is the appropriate response?

The practitioner should explain that limited assurance involves fewer procedures and provides only a moderate level of assurance, with a negatively worded conclusion. It cannot give the high but not absolute comfort of reasonable assurance, regardless of the data being quantitative.

  1. AAgree, as the nature of procedures can be reduced without affecting the assurance level
  2. BExplain that limited assurance involves fewer procedures and gives a moderate level of assurance expressed in negative form, so it cannot give audit-level comfortCorrect
  3. CConvert the engagement to a review of historical financial information under SRE 2400
  4. DIssue a positive-form opinion since emissions data are quantitative

Explanation

Limited assurance gives a meaningful but lower level of assurance, and the conclusion is stated negatively (nothing has come to attention). Reduced procedures cannot yield reasonable-assurance comfort. Option A wrongly links lower procedures to equal comfort.

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