Concepts of Assurance and Non-Assurance Services

Procurement and Audit notes revision

Assurance services are audit activities that provide an independent, objective assessment of financial statements or compliance efforts. The objectives of these audits are to assure management, the board, and regulators that financial statements are accurate, and operations are done in accordance with applicable policies and regulations. These compliance, regulatory, and financial statement audits are all considered assurance services. An assurance engagement as defined in International Standard on Assurance Engagements (ISAE) 100 is an engagement in which a professional auditor in public practice expresses a conclusion designed to enhance the degree of confidence of the intended users other than the responsible party about the outcome of the evaluation or measurement of a subject matter against criteria.
ISAE 100 identified the following elements of an assurance engagement that may influence the level of assurance:
 Subject matter: Some subject matter is inherently more capable of reliable measurement and support by relatively conclusive evidence.
 Criteria: Depending on the nature of the subject matter, some criteria provide a means of more reliable measurement of the subject matter. For example, a lower level of assurance will often be provided when the criteria are qualitative rather than quantitative.
 Procedures (work effort): The higher the level of assurance to be provided, the more comprehensive must be the procedures performed.
 Quantity and quality of evidence gathered: The assurance provider will seek to obtain sufficient appropriate evidence as the basis for the assurance provided. In conjunction with the nature and form of the subject matter, criteria and procedures, the reliability of the evidence itself can impact the overall levels of assurance provided.

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