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Unformatted text preview: sented in an assertion that is available to the intended users.
Alternatively, the assignment could be a direct reporting assurance engagement, where there is no
assertion and there may or may not be a written representation from the newspapers.
In such engagements, when determining whether it is necessary to apply the provisions in Section 291 to
each responsible party, the firm may take into account whether an interest or relationship between the
firm, or a member of the assurance team, and a particular responsible party would create a threat to
independence that is not trivial and inconsequential in the context of the subject matter information. This
will take into account:
(a) The materiality of the subject matter information (or the subject matter) for which the particular
responsible party is responsible; and
(b) The degree of public interest that is associated with the engagement.
If the firm determines that the threat to independence created by any such relationships with a particular
responsible party would be trivial and inconsequential it may not be necessary to apply all of the
provisions of this section to that responsible party.
The following example has been developed to demonstrate the application of Section 291. It is assumed
that the client is not also a financial statement audit client of the firm, or a network firm.
A firm is engaged to provide assurance on the total proven oil reserves of 10 independent companies.
Each company has conducted geographical and engineering surveys to determine their reserves (subject
231 matter). There are established criteria to determine when a reserve may be considered to be proven which
the professional accountant in public practice determines to be suitable criteria for the engagement.
The proven reserves for each company as at December 31, 20X0 were as follows:
Proven oil reserves
thousand of barrels
Company 1 5,200 Company 2 725 Company 3 3,260 Company 4 15,000 Company 5 6,700 Company 6 39,126 Company 7 345 Company 8 175 Company 9 24,1...
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This document was uploaded on 04/03/2014.
- Spring '14