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During an assurance review a qualified accountant will review your accounts and investigate any areas of concern.

Inquiries of management and sophisticated analytical review techniques allow a chartered accountant to assess the financial statements at a high level.

This includes analysing changes from one year to the next and may include further sample testing and additional procedures to address identified concerns.

The accountant considers: does anything they have seen during the review suggest a problem in the financial statements that needs further checking to sort out?

A conclusion is presented in a report which is appended to your financial statements so that everybody who reads them can see that an independent review has taken place.

What is an assurance review engagement?

An assurance review engagement is carried out in accordance with the International Standard for Review Engagements (ISRE) 2400 (Revised).

ISRE 2400 (Revised) requires the chartered accountant to make enquiries of management, and others, and to carry out analytical procedures to gain a degree of assurance that:

  • the financial statements comply with the chosen financial reporting framework and give a true and fair view; and
  • management is aware of its responsibilities for producing the accounts.

To be able to do this the chartered accountant will:

  • Review all material items in the financial statements.
  • Consider and make enquiries of management about factors which might lead to increased risk that the financial statements may contain material misstatements or be non-compliant such as:
  • The nature of the client’s business and its organisational structures
  • The incidence of fraud
  • Non-compliance with laws and regulations
  • Undisclosed related party transactions
  • Going concern problems
  • Post balance sheet events
  • Accounting estimates
  • Suitability of accounting policies
  • Significant, unusual or complex transactions or events.

Review engagements, like audit engagements, may help the accountant to report weaknesses and other issues that come to their attention to the directors. In other words, such engagements can generate much more value for the directors than just the assurance report itself. This represents a substantial degree of understanding of the client’s circumstances.

Further substantive testing is not required unless the chartered accountant has reason to be concerned about some aspect of the business. An assurance review engagement is therefore a flexible and proportionate service which can be adapted to suit different clients.

Other assurance options:

ICAEW's assurance resource

This page is part of ICAEW’s online assurance resource, which replaces the Assurance Sourcebook.

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