ACCA F8 Audit & Assurance (International)

To enable the auditor to express an opinion on whether the financial statements are prepared;

• in all material respects
• in accordance with an applicable financial reporting framework.

To enable the auditors to give an opinion on financial statements

Solely to report to the shareholders

provides assurance to the shareholders and other stakeholders of a company on the financial statements because it is independent and impartial

Accountability is the quality or state of being accountable, that is, being required or expected to justify actions and decisions.

Its suggests an obligation or willingness to accept responsibiloty for one's actions.

Directors (Management) are accountable to shareholders.

refers to the duties and obligations of a person who manages another person's property.

These are people (Directors: Management) employed or used to provide a particular service by managing the business. They also maximise their personal wealth in their own right.

They are accountable for the shareholder's investment. The shareholders have bought shares in the company. They expect a return from their investment. As the directors manage the company, they are in a position to affect that return.

An assurance engagement is one in whcih a practitioner expresses a conclusion designed to enhance the dgree of confidence of the intended users other than the responsible party about the outcome of the evaluation or measurement of the subkect matter against criteria.

The outcome of the evaluation or measurement of a subject matter is the information that results from applying the criteria to the subject matter.

Depends on the level of assurance given; There are two types;

• reasonable assurance engagement ( High but not absolute level of assurance given)
• Limited assurance ( low level of assurance

It is a reduction in assurance engagement risk to an acceptably low level in the circumstances of the engagement as the basis for a positive form of expression of the practitioner's conclusion

In order to give a reasonable assurance, a significant amount of testing and evaluation is required to support the positive conclusion, such as the opinion given in the auditor's report on the financial statements.

It is a lower level of assurance. It allows for a lesser amount of testing and evaluation and results in a negative conclusion

Objective is the reduction in assurance engagement risk to a level that is acceptable in the circumstances of the engagement, but where that risk is greater than for a reasonable assurance engagement, as the basis for a negative form of expression of the practitioner's conclusion