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

Tamsin Accounting is completing a compilation engagement for Redfern Ltd under ISRS 4410 (Revised). Which statement about the compilation report is correct?

The compilation report should describe the engagement and make clear that it is not an assurance engagement, so the practitioner provides no assurance on the compiled information. Limited assurance applies to reviews, and audit or agreed-upon procedures wording would be inappropriate under ISRS 4410 (Revised).

  1. AIt must express a limited assurance conclusion on the compiled financial information
  2. BIt must describe the compilation engagement and state that, as it is not an assurance engagement, the practitioner provides no assurance on the informationCorrect
  3. CIt must be addressed to the tax authority as the primary user
  4. DIt must state that the information was audited using the agreed-upon procedures

Explanation

A compilation is not an assurance engagement. The report states what the practitioner did, that the information was compiled using management's information, and that no audit or review was performed and no assurance is expressed. Limited assurance applies to reviews.

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