ACCA Strategic Professional · Advanced Audit and Assurance (International) · Audit-related and assurance services
Kestrel & Co is engaged to provide assurance on Danu plc's report on customer satisfaction. Danu's management proposes criteria that it has devised itself, available only to its internal team, and which allow management to choose the survey method after seeing results. Kestrel's engagement partner considers whether to accept. What is the most appropriate conclusion on the criteria?
The practitioner should decline the engagement as assurance because the criteria are unsuitable. Suitable criteria must be relevant, complete, reliable, neutral, understandable and available to users. Choosing the survey method after seeing results breaches neutrality and reliability, and limited availability is a further failing. Disclosing the weakness does not make the criteria suitable.
- AAccept, because criteria developed by the responsible party are always suitable
- BAccept, but only if the report states that the criteria are internal
- CDecline as an assurance engagement, because the criteria are not suitable, lacking characteristics such as neutrality, objectivity and availability to usersCorrect
- DAccept and issue a reasonable assurance opinion, since the criteria can be improved later
Explanation
Suitable criteria are relevant, complete, reliable, neutral, understandable and available to intended users. Allowing method choice after seeing results undermines neutrality and reliability, and restricted availability fails the availability test. Disclosure of the weakness does not cure unsuitable criteria, so the engagement is not acceptable as assurance.
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