The ISA or International Standards on Auditing, require your auditor to perform a variety of audit procedures in order to obtain audit evidence that is appropriate and sufficient in order to reach this opinion with a high, but not absolute, level of assurance. And the purpose of an audit is to provide financial statement users with an opinion on whether the financial statements are presented fairly, in all material respects, in accordance with the applicable financial reporting framework.
In a compilation engagement, the objective is to present in the form of financial statements information that is the representation of management without undertaking to express any assurance on the financial statements. The CPA does not perform any audit or review procedures. Although a compilation is not an assurance engagement, it is an attest engagement.
A CPA may express limited (negative) assurance on financial statements that have not been audited. The objective of a review engagement is to express limited assurance that there are no material modifications that should be made to the financial statements in order for the statements to be in conformity with the applicable financial reporting framework. A review is based on inquiry and analytical procedures performed by the CPA. A review is both an assurance engagement and an attest engagement.
An agreed-upon procedures engagement is one in which the practitioner is engaged by a client to issue a report of findings based on specific agreed-upon procedures. It may be performed on the designated subject matter of a wide variety of assertions as a result of a need of specific parties. Attestation standards apply to all agreed-upon procedures engagements, including those related to items from a financial statement. A written assertion generally is not required.
A forensic audit is an analysis and review of the financial records of a company or person to extract facts, which can be used in a court of law. ... Forensic audits cover a large spectrum of investigative activities. There may be a forensic audit to prosecute a party for fraud, embezzlement or other financial crimes.
Internal audits evaluate a company’s internal controls, including its corporate governance and accounting processes. These audits ensure compliance with laws and regulations and help to maintain accurate and timely financial reporting and data collection. Internal audits also provide management with the tools necessary to attain operational efficiency by identifying problems and correcting lapses before they are discovered in an external audit.