Other Assurance and Related services

ISRS 4400 (Revised), Agreed-Upon Procedures Engagements, has been revised to respond to the growing demand for these engagements. A broad range of stakeholders, such as regulators, funding bodies and creditors, use agreed-upon procedures reports for a variety of reasons. The revised requirements and application material promote consistency in the performance of agreed-upon procedures engagements, and include enhancement relating to, among other matters, the exercise of professional judgement, compliance with independence requirements, engagement acceptance and continuance considerations, using the work of a practitioner’s expert, and greater clarity and transparency in the agreed-upon procedures report. It is effective for engagements for which the terms of engagement are agreed on or after 1 January 2022.

What are Independent Reviews?

An Independent Review is a limited assurance engagement where the practitioner performs primarily inquiry and analytical procedures to obtain sufficient appropriate evidence as the basis for a conclusion on the financial statements as a whole, expressed in accordance with the requirements of ISRE 2400 (Revised). An Independent Review is performed by a practitioner who was not involved in the preparation of the financial statement. In terms of Regulation 29(4) an Independent Review of a company’s annual financial statements must be carried out:

• in the case of a company whose public interest score for the particular financial year was at least 100, by a registered auditor, or a member in good standing of a professional body that has been accredited in terms of section 33 of the Auditing Professions Act; or

• in the case of a company whose public interest score for the particular financial year was less than 100, by:

• a person contemplated in paragraph (a); or

• a person who is qualified to be appointed as an accounting officer of a close corporation in terms of section 60 (1), (2) and (4) of the Close Corporations Act, 1984 (Act No. 69 of 1984).

Independent reviews are not required for owner managed profit companies but can be performed voluntarily if the public interest score is less than 350 and the financial statements are independently compiled, or if the public interest score is less than 100. An independent review can also be performed voluntarily for CC’s but the cost versus benefit needs to be considered.

International Standard on Related Services 4410 (Revised) (ISRS 4410 (Revised)) deals with the practitioner’s responsibilities when engaged to assist management with the preparation and presentation of historical financial information without obtaining any assurance on that information, and to report on the engagement in accordance with this ISRS.