Audit & Assurance

Adverse Opinion An adverse opinion is the audit opinion stating that the financial statements are not fairly presented in all material respects. Agreed-Upon Procedures Agreed-upon procedures, often called AUP, is an engagement where the accountant performs specific procedures and reports factual findings without giving assurance. Assurance Assurance is the professional work intended to increase confidence in information for users who rely on it. Audit An audit is the highest level of financial statement assurance provided by an independent CPA firm. Audit Sampling Audit sampling is the process of testing less than every item in a population to draw conclusions about the larger set under audit. Audit vs Review Audit vs review is the comparison between the highest level of assurance from financial statement work and the more limited assurance level of a review. Compilation A compilation is a financial statement service where a CPA presents information in statement form without providing assurance. Disclaimer of Opinion A disclaimer of opinion is the report issued when the auditor cannot obtain enough evidence to express an opinion. Going Concern Going concern is the concept that a business is expected to continue operating long enough to meet its obligations and carry out its plans. Independence Independence is the requirement that the accountant remain free from relationships or interests that impair objective judgment in assurance work. Internal Controls Internal controls are the policies and processes designed to reduce error, fraud, and operational breakdown in financial and business activities. Management Letter A management letter is the communication accountants may provide to management about deficiencies, recommendations, or observations found during an engagement.