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ACCA Strategic Professional · Advanced Audit and Assurance (International) · Reporting on other assignments

Kestrel & Partners is engaged under ISRS 4410 (Revised) to compile the financial information of Orchard Farms, a small partnership. Which statement correctly describes the practitioner's responsibilities in this compilation engagement?

In a compilation engagement the practitioner applies accounting and financial reporting expertise to help management prepare and present the financial information. The practitioner does not need to verify the data or obtain evidence, and gives no assurance, so no opinion or review conclusion is expressed.

  1. AObtain sufficient appropriate evidence to express limited assurance on the information compiled
  2. BApply accounting and financial reporting expertise to assist management in preparing and presenting the information, without obtaining assurance on itCorrect
  3. CTest the operating effectiveness of internal controls over the accounting records before compiling
  4. DExpress an opinion on whether the compiled information is free from material misstatement

Explanation

A compilation engagement under ISRS 4410 (Revised) uses the practitioner's accounting expertise to help management prepare and present financial information. The practitioner is not required to verify the information or obtain evidence to provide assurance. Limited assurance, opinions and controls testing belong to review or audit work.

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