Prospective financial information - acceptance considerations
You'll learn how to assess whether you should accept a prospective financial information engagement, and what safeguards to put in place before you start.
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In this lesson
- 0:00 Understanding users and duty of care
- 0:33 Assessing forecast assumptions and content
- 1:17 Identifying ethical threats in engagements
- 1:59 Establishing separate engagement terms
- 2:36 Limited assurance procedures and responsibilities
About this lesson
This video covers the key acceptance considerations: identifying who will use the information and their needs, evaluating the reasonableness of underlying assumptions, recognising ethical threats like self-interest and advocacy risks, and establishing clear engagement terms separate from any audit work. Understanding these acceptance criteria is essential for AA (Audit and Assurance) engagements, particularly when clients need forecasts for lending decisions or stakeholder reporting. By working through these checks upfront, you'll protect your independence, manage liability, and set realistic expectations about the limited assurance you can provide on inherently uncertain forward-looking information.
Duration: 4m
Transcript
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