What's the difference between assurance, attestation, and auditing services???

CPA Exam Forum AUD AUD Review What's the difference between assurance, attestation, and auditing services???

This topic contains 8 replies, has 6 voices, and was last updated by  Fikryshayeb@hotmail.com 9 months ago.

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    Can you guys give me some examples for each service?

    I know this is a stupid for all the people that passed 🙂



    Attest is an engagement that requires independence. This includes audits, reviews, compilations, attestation and assurance services.

    Attestation is an engagement where a written report is issued on something other than historical financial statements. Examples are: agreed upon procedures, attest to the MD&A, reporting on internal controls for nonissuers, prospective F/S, and Pro Forma F/S.

    Finally, assurance services is defined as independent professional services that improve the quiality of information for decision makers. Examples include: risk assessment, performance measurement, ElderCare (or PrimePlus), WebTrust, SysTrust, e-commerce.



    I had to laugh when I read the title of your post because I really struggled with this one too. And I just took AUD on Monday. So, I may not be laughing when I get my scores, we'll see…

    I disagree a bit with the previous poster. My understanding is that:

    *Assurance services are a broad category of services designed to improve the quality of decision making by improving confidence in the information on which decisions are made.

    *Attestation services are a subcategory of assurance services. They require independence and result in a report. They include examinations, reviews, and agreed upon procedures. Compilations are NOT included because they don't require independence.

    *Audits are are subcategory of attestation services. They are examinations of historical financial statements.



    Historical financial reporting = auditing (SAS – private – PCAOB – public)/

    review/compilation (SSARS – private – PCAOB – public)

    Interim financial reporting (SAS – private/PCAOB – Public)

    Non-historical financial reporting – other services = attestation (SSAE – private and PCAOB – public)



    cah2c, effective July 1 of this year, compilations require independence; however, the accountant may do a compilation if there is a lack of independence if they state this fact in the compilation report, or if no report, in the engagement letter. This came straight from my AUD review materials.



    Thanks!!!!! You guys made my day 🙂

    @cah2c i think you are right. I'm guessing Compilations are a subcategory of Assurance services?



    Another74CPA- Yes, I believe they are a type.



    Compilations are just the accountant taking the accounting data provided by management and creating financial statements. In other words, you're compiling financial statements. In the report, accountant says this is responsibility of management, no assurance is done, no opinions.

    There is no assurance or any kind of opinion stated.

    One possible exception to the above is if one of the numbers really jumps out and slaps you in the face. “$50,000 for petty cash for a small firm?????” Then I think you have to put something in the report that the number appears to be out of line.


    Here is a Break Down for the different Reports and their Authoritative Standards (previuosly answered, it's just an easier breakdown for better understanding)

    Public Companies – ISSUERS:

    Auditing of Historical Financial Statements – PCAOB
    Review of Interim Financial Statements – PCAOB
    Review & Compilation of Historical Financial Statements – PCAOB
    Attestation Services on non-historical financial information – PCAOB

    Private Companies – Non-Issuers:

    Auditing of Historical Financial Statements – SAS
    Review (Interim Reporting) of Audited Financial Statements – SAS
    Review & Compilation of Unaudited Financial Statements – SSARS
    Attestation Services on non-historical financial information – SSAE

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