ACA Accounting and Assurance Exam Questions and Answers with complete solution

Reasonable Assurance engagement 1. Evidence Sought 2. Opinion Given 3. Example - 1. Sufficient and Appropriate 2. Positive Opinion 3. The financial statements show a true and fair view in all material respects Limited Assurance engagement 1. Evidence Sought 2. Opinion Given 3. Example - 1. Sufficient and appropriate (less intrusive) 2. negative conclusion 3. Nothing has come to our attention that makes us believe that the subject matter is misstated Stakeholders - Benefits of audit and assurance - - enhances credibility of information being reported - reliable information to hold management to account - draws attention of user to any deficiencies Directors - Benefits of audit and assurance - - reduces management bias - deter fraud- enhances reliability of information being reported on - management letter contains constructive advice on internal controls Customers and Suppliers - Benefits of audit and assurance - - helps determine whether they should trade with the company lenders / banks - Benefits of audit and assurance - - business is scrutinised by another set of eyes - gives added confidence to lenders, making it easier for companies to raise finance Employees - Benefits of audit and assurance - - confidence over job security - confidence over bonuses payable if linked to profits Society - Benefits of audit and assurance - - ensures high quality, reliable information, circulates in the market - helps to improve company's reputation - additional assurance to 3rd parties such as tax authorities