Review engagements

A review is a defined engagement performed by independent assurance experts following review standards as issued by the External Reporting Board.  A review involves a lesser level of work and detail testing than an audit and hence provides a lesser level of assurance.  Whereas an audit provides a positive expression of independent opinion, a review provides a negative assurance opinion along the lines that "nothing has come to the reviewer's attention that anything is wrong".  However, a review engagement can be a useful introduction to independent assurance over your financial statements.  Much like an audit, management find that the review process brings about enhancements to the year end process by the very fact that another independent and objective party is considering the nature of balances and transactions.

Agreed-upon procedure engagement

A less well known alternative is to engage independent assurance experts to provide agreed procedures of a targeted nature and report exclusively on this.  These types of engagements usually focus on a limited number of aspects of the operations, internal controls, or of your financial statements.

These engagements can be customised and focused to shareholder or management concerns. The key to such engagements is a clear scoping and understanding of what is desired to be done and clearly agreeing this at the outset. This can involve one or more of the following scopes:

  •  Testing of particular balances of concern - for instance debtors, creditors
  •  Internal controls assessment/Systems review and testing
  •  Information technology assurance 


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