This ASAE deals with assurance engagements other than audits or reviews of historical financial information, which are dealt with in the Australian Auditing Standards and Auditing Standards on Review Engagements, respectively. (Ref: Para. A21–A22)
Assurance engagements include both attestation engagements, in which a party other than the assurance practitioner measures or evaluates the underlying subject matter against the criteria, and direct engagements, in which the assurance practitioner measures or evaluates the underlying subject matter against the criteria. This ASAE contains requirements and application and other explanatory material specific to reasonable and limited assurance attestation engagements. This ASAE may also be applied to reasonable and limited assurance direct engagements, adapted and supplemented as necessary in the engagement circumstances.
This ASAE is premised on the basis that:
- The members of the engagement team and the engagement quality reviewer (for those engagements where one has been appointed) are subject to the relevant ethical requirements[#] related to assurance engagements, or other professional requirements, or requirements in law or regulation, that are at least as demanding; and (Ref: Para. A30–A33)
- The assurance practitioner who is performing the engagement is a member of a firm that is subject to ASQM 1, or other professional requirements, or requirements in law or regulation, regarding the firm’s responsibility for its system of quality management, that are at least as demanding as ASQM 1.
Quality management within firms that perform assurance engagements, and compliance with ethical principles, including independence requirements, are widely recognised as being in the public interest and an integral part of high‑quality assurance engagements. Assurance practitioners in public practice will be familiar with such requirements. If a competent assurance practitioner other than a member of a professional accounting body in public practice chooses to represent compliance with this or other ASAEs, it is important to recognise that this ASAE includes requirements that reflect the premise in the preceding paragraph.
Scope of this Standard on Assurance Engagements
This ASAE covers assurance engagements other than audits or reviews of historical financial information, as described in the Framework for Assurance Engagements (Assurance Framework). Where a subject‑matter specific ASAE is relevant to the subject matter of a particular engagement, that ASAE applies in addition to this ASAE. (Ref: Para. A21–A22)
Not all engagements performed by assurance practitioners are assurance engagements. Other frequently performed engagements that are not assurance engagements, as defined by paragraph 12(a) of this ASAE (and therefore are not covered by the ASAEs) include:
- Engagements covered by Auditing Standards on Related Services (ASRS), such as agreed‑upon procedure and compilation engagements;
- The preparation of tax returns where no assurance conclusion is expressed; and
- Consulting (or advisory) engagements, such as management and tax consulting. (Ref: Para. A1)
An assurance engagement performed under the ASAEs may be part of a larger engagement. In such circumstances, the ASAEs are relevant only to the assurance portion of the engagement.
The following engagements, which may be consistent with the description in paragraph 12(a) of this ASAE, are not considered assurance engagements in terms of the ASAEs:
- Engagements to testify in legal proceedings regarding accounting, auditing, taxation or other matters; and
- Engagements that include professional opinions, views or wording from which a user may derive some assurance, if all of the following apply:
- Those opinions, views or wording are merely incidental to the overall engagement;
- Any written report issued is expressly restricted for use by only the intended users specified in the report;
- Under a written understanding with the specified intended users, the engagement is not intended to be an assurance engagement; and
- The engagement is not represented as an assurance engagement in the assurance practitioner’s report.
Relevant ethical requirements are defined in ASA 102 Compliance with Ethical Requirements when Performing Audits, Reviews and Other Assurance Engagements.
See Auditing Standard ASQM 1 Quality Management for Firms that Perform Audits or Reviews of Financial Reports and Other Financial Information, or Other Assurance or Related Services Engagements.