Reasonable assurance engagement

What is the difference between a reasonable and limited assurance engagement?

For a limited assurance engagement the practitioner collects less evidence than for a reasonable assurance engagement but sufficient for a negative form of expression of the practitioner’s conclusion.

What is assurance engagement?

The basic premise of an assurance engagement is to present users with confidence regarding the subject matter. Based on this assurance, users can make well-informed decisions regarding the company. For them, assurance engagements provide certainty about the risk involved with such decisions.

What is reasonable assurance and why is it important?

As this type of engagement requires reasonable assurance, the associated risks are higher. Therefore, the practitioner will perform more detailed work to gain sufficient appropriate evidence to reduce the risks. The work performed will typically include tests of controls and substantive procedures.