[Deleted by the AUASB.  Refer Aus 1.1.]

This Australian Standard on Assurance Engagements (ASAE) deals with limited or reasonable assurance attestation engagements undertaken by an assurance practitioner^[1] to report on the responsible party’s^[2] compilation of pro forma historical financial information included in a prospectus, other public document, or prepared for any other purpose.  For ease of reference, in this ASAE the term ‘prospectus’ is taken to include an other public document or non‑public document prepared for any other purpose, unless otherwise noted. (Ref: Para. A1)

 When the assurance practitioner is requested to provide assurance on the pro forma financial information itself, refer to ASAE 3450 Assurance Engagements involving Corporate Fundraisings and/or Prospective Financial Information.

Nature of the Assurance Practitioner’s Responsibility

In an engagement performed under this ASAE, the assurance practitioner has no responsibility to compile the pro forma financial information for the entity; such responsibility rests with the responsible party.  The assurance practitioner’s sole responsibility is to report on whether the pro forma financial information has been compiled, in all material respects, by the responsible party on the basis of the applicable criteria.

This ASAE does not deal with non‑assurance engagements in which the assurance practitioner is engaged by the entity to compile its historical financial information.

Purpose of Pro Forma Financial Information Included in a Prospectus

The purpose of pro forma financial information included in a prospectus is solely to illustrate the impact of a significant event(s) or transaction(s) on unadjusted financial information of the entity as if the event had occurred or the transaction had been undertaken at an earlier date selected for purposes of the illustration.  This is achieved by applying pro forma adjustments to the unadjusted financial information.  Pro forma financial information does not represent the entity’s actual financial position, financial performance, or cash flows.  (Ref: Para. A2‑A3)

In this ASAE ‘pro forma financial information’ is taken to mean pro forma historical financial information.  Reporting on the compilation of pro forma financial information in the form of a pro forma forecast is not included within the scope of this ASAE.

Compilation of Pro Forma Financial Information

The compilation of pro forma financial information involves the responsible party gathering, classifying, summarising and presenting financial information that illustrates the impact of a significant event(s) or transaction(s) on unadjusted financial information of the entity as if the event had occurred or the transaction had been undertaken at the selected date. Steps involved in this process include:

• Identifying the source of the unadjusted financial information to be used in compiling the pro forma financial information, and extracting the unadjusted financial information from that source; (Ref: Para. A4-A5)
• Making pro forma adjustments to the unadjusted financial information for the purpose for which the pro forma financial information is presented; and
• Presenting the resulting pro forma financial information with accompanying disclosures.

Nature of Reasonable Assurance Engagement

A reasonable assurance engagement to report on the compilation of pro forma financial information involves performing the procedures set out in this ASAE to assess whether the applicable criteria used by the responsible party in the compilation of the pro forma financial information provide a reasonable basis for presenting the significant effects directly attributable to the event(s) or transaction(s), and to obtain sufficient appropriate evidence about whether: (Ref: Para. A6)

• The related pro forma adjustments give appropriate effect to those criteria; and
• The resultant pro forma column (see paragraph Aus 11.1 of this ASAE) reflects the proper application of those adjustments to the unadjusted financial information.

It also involves evaluating the overall presentation of the pro forma financial information. The engagement, however, does not involve the assurance practitioner updating or reissuing any reports or opinions on any historical financial information used in compiling the pro forma financial information, or performing an audit or review of the financial information used in compiling the pro forma financial information.

Nature of Limited Assurance Engagement

A limited assurance engagement to report on the compilation of pro forma financial information involves performing the limited procedures set out in this ASAE to assess whether anything comes to the assurance practitioner’s attention that causes the assurance practitioner to believe that the applicable criteria used by the responsible party in the compilation of the pro forma financial information does not provide a reasonable basis for presenting the significant effects directly attributable to the event(s) or transaction(s), or that: (Ref: Para. Aus A6.1-A6.4)

• The related pro forma adjustments do not give appropriate effect to those criteria; and
• The resultant pro forma column (see paragraph Aus 11.1 of this ASAE) does not reflect the proper application of those adjustments to the unadjusted financial information.

It also involves evaluating the overall presentation of the pro forma financial information. The engagement, however, does not involve the assurance practitioner updating or reissuing any previously issued reports or opinions on any historical financial information used in compiling the pro forma financial information, or performing an audit or review of the financial information used in compiling the pro forma financial information.

Relationship with ASAE 3000, and Other Requirements

The assurance practitioner is required to comply with ASAE 3000 and this ASAE when performing an assurance engagement to report on the compilation of pro forma historical financial information included in a prospectus, other public document, or prepared for any other purpose.  This ASAE supplements, but does not replace, ASAE 3000, and expands on how ASAE 3000 is to be applied in a reasonable or limited assurance engagement to report on the compilation of pro forma financial information included in a prospectus, other public document, or prepared for any other purpose. 

[Deleted by the AUASB.  Refer Aus 8.1.]

Compliance with ASAE 3000 requires, among other things, compliance with relevant ethical requirements related to assurance engagements, or other professional requirements, or requirements imposed by law or regulation, that are at least as demanding.^[*]  It also requires the lead assurance practitioner^[#] to be a member of a firm that applies ASQM 1,^[†] or other professional requirements, or requirements in law or regulation, that are at least as demanding as ASQM 1.

[Deleted by the AUASB.  Refer Aus 0.3.]