Which of the following best describes an engagement to report on an entity's internal control over financial reporting for a nonpublic company?
A)An attestation engagement to examine and report on management's written assertions about the effectiveness of its internal control structure
B)An audit engagement to render an opinion on the entity's internal control structure
C)A prospective engagement to project,for a period of time not to exceed one year,and report on the expected benefits of the entity's internal control structure
D)A consulting engagement to provide constructive advice to the entity on its internal control structure

Question

Quizplus · Accepted Answer

An engagement to report on an entity's internal control over financial reporting for a nonpublic company is typically an attestation engagement where the auditor examines and reports on management's written assertions about the effectiveness of its internal control structure. This is in accordance with the requirements of the Generally Accepted Auditing Standards (GAAS) and the Public Company Accounting Oversight Board (PCAOB). Option B is incorrect because an audit engagement for internal control over financial reporting is typically required for public companies only. Option C is incorrect because a prospective engagement is a type of forecast or projection, which is not relevant for an engagement to report internal control over financial reporting. Option D is incorrect because a consulting engagement does not involve the issuance of a written report.

Which of the Following Best Describes an Engagement to Report