An accountant may accept an engagement to apply agreed-upon procedures to prospective financial statements provided that:
A)distribution of the report is restricted to the specified users involved.
B)the prospective financial statements also are examined.
C)responsibility for the adequacy of the procedures performed is taken by the accountant.
D)negative assurance is expressed on the prospective financial statements taken as a whole.

Question

Quizplus · Accepted Answer

According to the AICPA's Statements on Standards for Attestation Engagements (SSAE), when an accountant agrees to apply agreed-upon procedures to prospective financial statements, the report's distribution should be limited to specified users involved. Therefore, choice A is the best answer. The other options are incorrect because the engagement is not to examine prospective financial statements, nor is the accountant responsible for their adequacy, and negative assurance is not given in agreed-upon procedures engagements.

An Accountant May Accept an Engagement to Apply Agreed-Upon Procedures