Audit and Assurance Essentials: For Professional Accountancy Exams, + Website

CHAPTER 9

SMALLER ENTITY AUDITS, REVIEWS, COMPILATIONS, AGREED-UPON PROCEDURES ENGAGEMENTS, NOT-FOR-PROFIT ENGAGEMENTS

Covering: Smaller Entity Audits, ISRE 2400 Engagements to Review Historical Financial Statements, ISRE 2410 Review of Interim Financial Information, ISRS 4410 Compilation Engagements, ISRS 4400 Engagements to Perform Agreed-Upon Procedures Regarding Financial Information, Not-for Profit Engagements.

Why do I need to read this section?

Smaller entities provide most of the work that keeps smaller firms in business and a great deal of the work that supports larger firms. Often described as the backbone of the economy, smaller entities provide a large proportion of national employment in many jurisdictions. Smaller entities grow into larger entities. For accounting and auditing purposes, smaller entities are often defined by their turnover, total assets and number of employees. Numerically, the vast majority of companies or other business entities registered in many jurisdictions are officially smaller or medium-sized. While practitioners have always provided tax services to their smaller entity clients, they increasingly provide business advice and assistance, often in connection with accounting software. Even so, smaller entities have always needed and will probably always need help with their accounts; furthermore, compilation services as well as audits and reviews remain an important revenue stream for many smaller auditing firms.

Not-for-profit engagements, including ...