In the field of auditing, both audit engagements and attestation engagements are important processes that involve the examination and assessment of financial information. While they share similarities in terms of evaluating financial statements, there are key differences in their scope and objectives.
Table: Difference between Audit Engagement and Attestation Engagement
| Criteria | Audit Engagement | Attestation Engagement |
|---|---|---|
| Purpose | To express an opinion on the fairness and reliability of the financial statements. | To provide assurance on the reliability and credibility of specific assertions or subject matter other than financial statements. |
| Scope | Focuses on examining and evaluating the financial statements and accompanying disclosures. | Focuses on assessing and reporting on a wide range of subject matters, such as internal controls, compliance, sustainability reports, etc. |
| Objective | To express an opinion on whether the financial statements are presented fairly in accordance with the applicable financial reporting framework. | To provide assurance or agreed-upon procedures on the reliability and accuracy of specific assertions or subject matter. |
| Professional Standards | Governed by auditing standards, such as International Standards on Auditing (ISAs) or Generally Accepted Auditing Standards (GAAS). | Governed by attestation standards, such as Statement on Standards for Attestation Engagements (SSAEs) or International Standard on Assurance Engagements (ISAEs). |
| Reporting | Issues an audit report expressing an opinion on the fairness of the financial statements. | Issues an attestation report that provides assurance or reports on findings based on the procedures performed. |
| Subject Matter | Primarily focuses on financial statements and related disclosures. | Can include a wide range of subject matters, such as internal controls, compliance, sustainability reports, cybersecurity, etc. |
| Assurances | Provides reasonable assurance that the financial statements are free from material misstatements. | Provides assurance or reports on specific assertions or subject matters based on the agreed-upon procedures or criteria. |
Conclusion: In summary, audit engagements and attestation engagements are distinct in terms of their purpose, scope, objective, and reporting requirements. Audit engagements primarily focus on the examination of financial statements to express an opinion on their fairness, while attestation engagements assess and provide assurance on various subject matters beyond financial statements. Both types of engagements play important roles in evaluating and providing confidence in the reliability of financial information and other assertions within an organization.
