International Framework for Assurance Engagements
Businesses, investors, governments, tax authorities, market regulators and other stakeholders need to be able to rely on credible information flows to make economic decisions and policy. Confidence diminishes when there are uncertainties around the integrity of information or its fitness for purpose.
Assurance: building confidence and creating trust
Where businesses or stakeholders identify a particular need to build confidence in information and reinforce relationships of trust, external assurance can play a valuable role. An independent expert expressing assurance on information provides a strong signal that reports are trustworthy.
Audit of financial statements
There is a lack of understanding of what is meant by assurance and the types of assurance that are or can be made available. This is clear from the expectation gaps that arise even in relation to the most long-established of assurance services, the audit of financial statements.
International Framework for Assurance Engagements
The International Auditing and Assurance Standards Board (IAASB) published the International Framework for Assurance Engagements in 2004.
This sets out high-level principles applicable to various types of assurance services and might help to address some of these issues. But the practical application of this guidance still needs thorough testing.
The first assurance standard International Standard on Assurance Engagements 3000 (ISAE 3000) Assurance Engagements other than Audits or Reviews of Historical Financial Information.
There are important public interest issues to be addressed around the role of external assurance. That is why the dialogue and scrutiny promoted by this initiative are so important.