External Audit
The objective of an audit is to express an opinion about whether the financial statements are fairly presented, in all material respects, in conformity with International Financial Reporting Standards (IFRS) or some other financial reporting framework. An audit is conducted in accordance with International Auditing Standards (IAS) and includes tests of accounting records and other procedures considered necessary to express such an opinion. In accordance with these standards, A&C plans and performs the audit to obtain reasonable, but not absolute, assurance about whether the financial statements are free of material misstatement.
Review
The objective of a review is to obtain limited assurance that there are no material modifications that should be made to the financial statements. A review is typically performed because outside third parties or investors are looking for some comfort that the financial statements are not materially misstated, but do not require audited statements. A review is conducted in accordance with the International Standards on Review Engagement and consists primarily of inquiries of company personnel and analytical procedures applied to financial data. A review is significantly less in scope than an audit in accordance with IAS and only provides limited assurance that there are no material modifications that should be made to the financial statements. There is no expression of an opinion on the financial statements taken as a whole.
Compilation
The objective of a compilation engagement is for the accountant to use accounting expertise, as opposed to auditing expertise, to collect, classify and summarize financial information. This ordinarily entails reducing detailed data to a manageable and understandable form without a requirement to test the assertions underlying that information. The procedures employed are not designed and do not enable the accountant to express any assurance on the financial information. However, users of the compiled financial information derive some benefit as a result of the accountant’s involvement because the service has been performed with professional competence and due care.
Internal Controls
Documenting client’s controls or updating and organizing any existing documentation. This is a key element and prerequisite for any assessment of the internal controls of an organization, or a function within an organization, is that the existing processes and controls must be documented and “auditable”.
Internal Audit
Internal auditing is an independent, objective assurance and consulting activity designed to add value and improve an organization's operations. The audit firm has a professional duty to provide an unbiased and objective view and must be independent from the operations it evaluates and report to the highest level in the organization. To be effective, the internal audit activity must have qualified, skilled and experienced people who can work in accordance with the Code of Ethics and the International Standards.
Due Diligence
Conducting a due diligence audit lets client know in advance if a business is worth an investment of its time and money. Reviewing the financial and corporate documents plus anything else deemed material gives a complete picture of the company.
Non-assurance services
Firms have traditionally provided to their assurance clients a range of non-assurance services that are consistent with their skills and expertise. Providing non-assurance services may, however, create threats to the independence of the firm or members of the assurance team. The threats created are most often self-review, self-interest and advocacy threats.
Before the firm accepts an engagement to provide a non-assurance service to an assurance client, a determination shall be made as to whether providing such a service would create a threat to independence. In evaluating the significance of any threat created by a particular nonassurance service, consideration shall be given to any threat that the assurance team has reason to believe is created by providing other related non-assurance services. If a threat is created that cannot be reduced to an acceptable level by the application of safeguards the nonassurance service shall not be provided.
In providing assurance services to an assurance client, a firm shall not assume a management responsibility as part of the assurance service. If the firm were to assume a management responsibility as part of the assurance service, the threats created would be so significant that no safeguards could reduce the threats to an acceptable level. If the firm assumes a management responsibility as part of any other services provided to the assurance client, the firm shall ensure that the responsibility is not related to the subject matter and subject matter information of an assurance engagement provided by the firm.
Other Regulatory Filings and Government Reports
“Regulatory compliance” generally refers to an organization’s adherence to any and all applicable regulations, guidelines, specifications, and other legal requirements. People with managerial authority in a business entity, such as corporate directors and officers, are responsible for ensuring that their companies’ activities comply with all applicable local and national regulations. The field of regulatory compliance has arisen to assist managers with this responsibility.