Syllabus A1g

True And Fair Presentation

Auditors are required to express an opinion as to whether the financial statements give a ‘true and fair’ view

So far so good, what's the difference between the 2?

  • True

    1. Information is factual and conforms with reality

    2. Complies with accounting standards and any relevant legislation

    3. Data is correctly transferred from accounting records to the FS

  • Fair

    1. Information is clear, impartial and unbiased

    2. Reflects plainly the commercial substance of the transactions

Reasonable Assurance Engagement

This is like an audit right?
  • Yes indeed, an audit is a type of reasonable assurance engagement

Ok so what does Reasonable Assurance actually mean?
  • Well, it is actually a high level of assurance that the auditor is giving here

  • Therefore, sufficient evidence that the subject matter agrees in all material respects to the agreed criteria is required

  • Also it gives a Positive Assurance

    This means that in their opinion the subject has been prepared in accordance with the criteria required

    (as opposed to "there is nothing to suggest that the subject has not been prepared in line with the relevant criteria". 

    That would be negative assurance)