The AUASB Glossary (the Glossary) includes the terms defined in this ASRE as well as descriptions of other terms used in this ASRE, to assist in consistent application and interpretation. For example, the terms “management” and “those charged with governance” used throughout this ASRE are as defined in the Glossary. (Ref: Para. A11–A12)
For purposes of this ASRE, the following terms have the meanings attributed below:
Analytical procedures―Evaluations of financial information through analysis of plausible relationships among both financial and non‑financial data. Analytical procedures also encompass such investigation as is necessary of identified fluctuations or relationships that are inconsistent with other relevant information or that differ from expected values by a significant amount.
Engagement risk―The risk that the assurance practitioner expresses an inappropriate conclusion when the financial statements are materially misstated.
General purpose financial statements―Financial statements prepared in accordance with a general purpose framework.
General purpose framework―A financial reporting framework designed to meet the common financial needs of a wide range of users. The financial reporting framework may be a fair presentation framework or a compliance framework.
Enquiry―Enquiry consists of seeking information of knowledgeable persons from within or outside the entity.
Limited assurance―The level of assurance obtained where engagement risk is reduced to a level that is acceptable in the circumstances of the engagement, but where that risk is greater than for a reasonable assurance engagement, as the basis for expressing a conclusion in accordance with this ASRE. The combination of the nature, timing and extent of evidence gathering procedures is at least sufficient for the assurance practitioner to obtain a meaningful level of assurance. To be meaningful, the level of assurance obtained by the assurance practitioner is likely to enhance the intended users’ confidence about the financial statements. (Ref: Para. A13)
Professional judgement―The application of relevant training, knowledge and experience, within the context provided by assurance, accounting and ethical standards, in making informed decisions about the courses of action that are appropriate in the circumstances of the review engagement.
Special purpose financial statements―Financial statements prepared in accordance with a special purpose framework.
Special purpose framework―A financial reporting framework designed to meet the financial information needs of specific users. The financial reporting framework may be a fair presentation framework or a compliance framework.
- Assurance Practitioner―A person or an organisation, whether in public practice, industry, commerce or the public sector, providing assurance services. The term includes the engagement partner or other members of the engagement team, or, as applicable, the firm. Where this ASRE expressly intends that a requirement or responsibility be fulfilled by the engagement partner, the term “engagement partner” rather than “assurance practitioner” is used. “Engagement partner” and “firm” are to be read as referring to their public sector equivalents where relevant.
- Complete Set of Financial Statements―financial statements and related notes as determined by the requirements of the applicable financial reporting framework.
- Financial Statements―complete set of financial statements or a financial report.
- Financial Report―a complete set of financial statements, including the related notes, and an assertion statement by those responsible for the financial report.
- Relevant ethical requirements―relevant ethical requirements as described in ASA 102 Compliance with Ethical Requirements when Performing Audits, Reviews and Other Assurance Engagements, as amended.