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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Developments in sustainability assurance

Kestrel Foods plc asks its auditor to provide limited assurance on its reported Scope 1 and Scope 2 emissions. During planning, the engagement team debates how the nature of procedures differs from a reasonable assurance engagement. Which statement is correct?

In limited assurance, the practitioner performs less extensive procedures than in reasonable assurance and expresses a conclusion in negative form, stating that nothing has come to attention suggesting material misstatement. Risk consideration is still needed to design procedures, and the level of evidence obtained is lower than for reasonable assurance.

  1. AIn limited assurance, the practitioner's procedures are less extensive than in reasonable assurance, and the conclusion is expressed in a negative formCorrect
  2. BIn limited assurance, no risk assessment is needed because the conclusion is only a negative form of statement
  3. CIn limited assurance, the practitioner must obtain the same quantity of evidence as in reasonable assurance but may report later
  4. DIn limited assurance, the practitioner gives a positive opinion but with a higher level of materiality

Explanation

Limited assurance involves less extensive procedures than reasonable assurance and a conclusion stating that nothing has come to attention indicating material misstatement. Risk consideration is still required to design procedures, so the second option is wrong. The evidence quantity differs, and the conclusion is not positive.

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