International Standard on Related Services (ISAS) 4400, Engagements to Perform Agreed-Upon Procedures on Financial Information, should be read in conjunction with the Preface to the Compendium of International Standards on Quality Control, Auditing and Reviews, Other Assurance Engagements and Related Services Engagements.

Introduction

1. The purpose of this International Standard on Related Services (ISAS) is to establish standards and provide guidance regarding the professional responsibilities of the auditor in the performance of engagements involving the performance of agreed procedures relating to financial information and the form and content of the report provided in connection with such engagements. .

The term “auditor” is used in all official documents of the International Auditing Standards Board and assurance engagements, both in relation to audit engagements and in relation to reviews, other assurance engagements and related services that the auditor may provide. However, this use of the term does not mean that a person performing a review or providing assurance or related services must necessarily audit the entity's financial statements.

2. This standard primarily addresses engagements that involve financial information. However, its provisions may also be used when performing engagements in relation to non-financial information, provided that the auditor has the necessary knowledge of the relevant matter and there are reasonable criteria on the basis of which the auditor can form conclusions. In applying this standard, the auditor may also benefit from the guidance contained in International Standards on Auditing (ISAs).

3. An engagement to carry out agreed procedures may involve performing certain procedures on both individual elements of financial information (for example, accounts payable, receivable, purchases from related parties, revenue and profit of a segment of the organization), financial statements (for example, balance sheet), and the entire set of financial statements.

Purpose of engagement to carry out agreed procedures

4. The purpose of an agreed procedures engagement is to carry out the procedures specific to the audit and agreed upon between the auditor, the entity and relevant third parties, and to report on the findings.

5. Since the auditor merely reports findings of fact according to agreed upon procedures, no assurance is expressed. Instead, report users independently evaluate the procedures performed and comments provided by the auditor and draw their own conclusions based on the auditor's work.

6. The report is intended only for those parties who agreed to perform the procedures, since other parties, not having information about the reasons for the procedures, may misinterpret the results.

General principles of engagement for the implementation of agreed procedures

7. The auditor must comply with the Code of Ethics for Professional Accountants issued by the International Ethics Standards Board for Accountants (IESBA Code). The ethical principles governing the auditor's professional responsibilities in connection with this type of engagement are;

(a) honesty;

(b) objectivity;

(c) professional competence and due care;

(d) confidentiality;

(e) professional conduct;

(f) technical standards.

Independence is not a requirement for engagements to carry out agreed procedures. However, the terms or objectives of the engagement or national standards may require the auditor to comply with the independence requirements of the IESBA Code. If the auditor is not independent, this fact should be noted in the report of findings.

8. The auditor shall perform the engagement to perform agreed procedures in accordance with this standard and the terms of the engagement.

Defining Job Conditions

9. The auditor should ensure that everyone, including representatives of the entity and usually other identified parties who will receive copies of the findings report, has a clear understanding of what agreed upon procedures will be followed and what the terms of the engagement are. The following issues are subject to agreement:

the nature of the engagement, including the fact that the procedures performed are neither an audit nor a review and therefore no assurance will be expressed;

the stated purpose of the assignment;

identifying the financial information that will be subject to agreed upon procedures;

the nature, timing and scope of specific procedures to be performed;

the expected form of the report on the discovered facts;

restrictions on dissemination of the discovery report. If there is any conflict between such restrictions and the legal requirements (if applicable), the auditor will be required to decline to perform the engagement.

10. In some cases, for example where intended procedures are agreed between the regulator, industry and the accounting profession, the auditor may not have the opportunity to discuss the procedures with all parties who will receive the report. In such a case, the auditor may, for example, discuss the proposed procedures with relevant representatives of interested parties, review correspondence received from them, or forward to them a draft report to be issued.

11. Based on both his own interests and the interests of the client, the auditor should provide the client with a letter of engagement documenting the basic terms of the appointment. An engagement letter confirms the auditor's agreement to accept the assignment and helps avoid misunderstandings on issues such as the purpose and scope of the engagement, the scope of the auditor's responsibilities, and the form of reports to be produced.

12. The engagement letter should include the following items:

a list of procedures to be performed and agreed upon by the parties;

A statement that the report of findings will be distributed only to designated individuals who have consented to the procedures.

In addition, the auditor may, if deemed appropriate, attach to the engagement letter a draft report of findings that will be prepared. A sample engagement letter is provided in Appendix 1 to this IASB.

Planning

13. The auditor should plan the work so that the engagement achieves its purpose.

Documentation

14. The auditor should document all matters relevant to providing evidence in relation to the report of findings and evidence demonstrating that the engagement was conducted in accordance with this IASB and the terms of the engagement.

Procedures and evidence

15. The auditor should follow the procedures agreed upon by the parties, using the evidence collected as the basis for reporting findings.

16. Specific procedures that may be carried out as part of an engagement to carry out agreed procedures may include:

survey and analysis;

recalculation, comparison and technical verification of data accuracy;

observation;

inspection;

receiving confirmations.

Appendix 2 to this IASB provides an example report containing an indicative list of procedures that may be used as part of an engagement to carry out agreed procedures.

Preparing of report

17. The engagement report for the implementation of agreed procedures should contain sufficient detail of the purpose and agreed procedures of the engagement to enable the user to understand the nature and extent of the work performed.

18. The report of findings must include:

(a) title;

(b) the name of the recipient (usually the client who engaged the auditor to carry out the agreed procedures);

(c) identifying the specific financial or non-financial information for which agreed procedures have been performed;

(d) confirmation that the procedures performed are consistent with those agreed to by the recipient;

(e) a statement that the engagement was performed in accordance with the International Standard for Related Services applicable to engagements performing agreed upon procedures, or in accordance with national standards or established practice;

(f) if applicable, a statement that the auditor is not independent of the entity;

(g) an indication of the purpose for which the agreed procedures were carried out;

(h) a list of specific procedures performed;

(i) a description of the auditor's findings, including sufficient detail of any errors or discrepancies identified;

(j) a statement that the procedures performed constitute neither an audit nor a review and, therefore, no assurance is being expressed;

(k) a statement that if the auditor had performed additional procedures, audits or reviews, other matters might have been discovered and included in the report;

(l) a statement that the report is intended only for those persons who consent to the procedures;

(m) if applicable, a statement that the report relates only to specified items, accounts, items or specified financial and non-financial information and does not apply to the financial statements of the entity as a whole;

(n) the date of the report;

(o) auditor's address;

(p) auditor's signature.

Appendix 2 to this IASB provides an example of a discovery report prepared in connection with an engagement to perform agreed upon procedures on financial information.

Features of completing tasks for public sector organizations

1. A report prepared as part of an engagement for a public sector organization may be intended not only for those who have consented to the procedures, but also be distributed to a wider range of individuals and organizations (for example, when conducting a parliamentary inquiry into a public sector organization). organization or government agency).

2. It should also be noted that engagements for public sector entities can vary significantly and care is required in determining whether an engagement is truly an engagement to perform agreed procedures or, in essence, involves an audit of financial information (for example, an engagement to prepare a financial statement). performance results).

Annex 1

Example of a letter of agreement on the terms of an engagement to carry out agreed procedures

This letter of agreement is intended to be used as a guide in connection with the provisions of paragraph 9 of this IASB and is not a sample letter of agreement. The engagement letter must be modified to suit the requirements of the specific assignment and circumstances.

To the attention of the board of directors or other appropriate representatives of the client engaging the auditor

This engagement letter is intended to confirm our understanding of the terms and objectives of the engagement and the nature of the services we will provide and the limitations associated therewith. The engagement will be carried out in accordance with the International Standard for Related Services (or relevant national standards or established practice) applicable to engagements to carry out agreed procedures, which we will therefore indicate in our report.

We agreed to carry out the following procedures and that, based on the results of our work, a report on the facts discovered would be prepared:

(describe the nature, timing, and extent of the procedures that will be performed, including specification, if applicable, of the documents and data that will be examined, the list of persons you will contact, and the list of parties from whom you will obtain confirmation).

The procedures that will be performed are intended solely to assist you in (specify purpose). The report prepared by us must not be used for any other purpose and is provided for your information only.

The procedures we will perform do not constitute an audit or review in accordance with International Standards on Auditing or International Standards on Review Engagements (or specify relevant national standards or established practice), and therefore no assurance is expressed on their results.

We rely on your staff's full support and trust that they will provide us with any data, documentation or any other information requested in connection with this assignment.

Services billed as they are performed will be priced based on the amount of time it takes our technicians to complete the job plus overhead. The hourly rates of our specialists depend on the positions they occupy on the project, as well as the experience and skills necessary to provide qualified services.

Please sign and return to us the attached copy of this engagement letter to indicate your agreement to the terms of the engagement set forth herein, including the specific procedures that we agree will be performed.

Confirmed on behalf of ABC Organization

(signature)

[Name and title]

Appendix 2

Example of an Accounts Payable Findings Report

Findings Report

Attention (indicate the persons who engaged the auditor)

We have carried out the following procedures, as agreed to by you, in relation to ABC Company's accounts payable as of (insert date) as detailed in the appendices (not shown in this example). The engagement was performed in accordance with the International Standard for Related Services (or specify relevant national standards or established practice) applicable to engagements to perform agreed upon procedures. These procedures were performed solely to assist you in assessing the accuracy of accounts payable data and included the following:

1. We obtained and verified the summation of accounts payable balances in the balance sheet as of (insert date) prepared by ABC Organization and compared the total with the balance in the corresponding general ledger account.

2. We checked the names of major suppliers from the attached list (not in this example) and the amount of debt as of (specify date) with the names and amounts in the balance sheet.

3. We have received reconciliation reports from suppliers or asked them to confirm outstanding balances as of (specify date).

4. We compared such information or confirmations with the amounts referred to in paragraph 2. Where there were discrepancies, we asked ABC to provide a reconciliation. We have identified and compiled a list of outstanding invoices, credit notes and checks in excess of xxx. We have located and reviewed such invoices and credit notes that were subsequently received, as well as checks that were subsequently paid, and have confirmed that they should, in fact, have been reported as dishonored in the reconciliation.

Our conclusions based on the results of the procedures performed are listed below:

(a) For point 1, we have confirmed that the summation has been completed correctly and that the total amount is correct.

(b) In paragraph 2, we have confirmed that there are no differences between the reconciled amounts.

(c) In relation to clause 3, we have confirmed that confirmations have been provided for all suppliers.

(d) For item 4, we confirmed that the amounts were consistent and, where there were discrepancies, we confirmed that ABC had prepared a reconciliation and that credit notes, invoices and outstanding checks in excess of xxx were correctly reported as items under which there are discrepancies, with the exception of:

(detail exceptions).

Given that the procedures referred to above do not apply to an audit or review conducted in accordance with International Standards on Auditing or International Standards on Review Engagements (or relevant national standards or customary practices), we express no assurance regarding accounts payable as at (insert date).

If we had performed additional procedures or conducted an audit or review of the financial statements in accordance with International Standards on Auditing or International Standards on Review Engagements or relevant national standards or customary practices, we might have identified other matters that you would like to know about. informed.

Our report is intended to be used solely for the purposes specified in the first paragraph of this document and for your information and may not be used for any other purpose or distributed to other parties. This report relates only to the accounts and items mentioned above and does not apply to the financial statements of ABC Entity as a whole.

[Auditor]

Engagements to Perform Agreed Procedures on Financial Information (IAS 4400): Details for the Accountant

... ; and related services 4400 “Tasks for the implementation of agreed procedures in relation to financial information”, reservations appeared, respectively, “...

FEDERAL RULES (STANDARDS)

AUDITING ACTIVITIES

(Approved by the Decree of the Government of the Russian Federation

RULE (STANDARD) N 30.

PERFORMANCE

FINANCIAL INFORMATION

Introduction

1. This federal rule (standard) of auditing activities, developed taking into account international standards of related services, establishes uniform requirements for the provision of services related to auditing - the implementation of agreed procedures in relation to financial information.

2. This federal auditing rule (standard) applies when performing agreed upon procedures with respect to financial information.

3. This federal auditing rule (standard) can also be applied when performing agreed upon procedures in relation to non-financial information, provided that:

a) an audit organization or an individual auditor (hereinafter referred to as the auditor) has adequate knowledge on a specific subject;

b) there is a certain criterion for achieving results.

4. Agreed-upon procedures can be performed by the auditor in relation to individual indicators of financial information (for example, accounts receivable or payable, purchases from affiliates, sales volume and profit of divisions of a person who has entered into an agreement to provide audit-related services), one of the elements of financial (accounting) statements ( for example, a balance sheet) or financial (accounting) statements as a whole.

Purpose of following agreed procedures

regarding financial information

5. The purpose of performing agreed procedures in relation to financial information is for the auditor to carry out audit procedures that have been agreed upon between the auditor, the person contracting to provide services related to the audit, and a third party, and to provide a report on the facts noted during the performance of the agreed procedures regarding financial information.

6. Since the auditor only provides a report, he does not express an opinion on the reliability of the financial (accounting) statements and financial information. Users of the report make their own assessment of the agreed procedures performed on the financial information and the facts stated in the report, and draw their own conclusions based on the report.

7. The report is provided only to those parties who have given their consent to carry out these procedures, since other parties who do not know the reasons for these procedures may misinterpret their results.

General principles of implementation

agreed procedures regarding

financial information

8. The ethical principles that guide the auditor in performing agreed procedures regarding financial information are:

a) honesty;

b) objectivity;

c) professional competence and integrity;

d) confidentiality;

e) professional behavior;

f) following the documents regulating this activity.

9. Independence is not a requirement when carrying out agreed procedures. However, the terms or objectives of the engagement may require the auditor to comply with requirements relating to his independence. If the auditor is not independent, this must be indicated in the report.

10. The auditor performs agreed upon procedures with respect to financial information in accordance with this federal auditing rule (standard) and the terms of the engagement.

Defining Execution Conditions

agreed procedures regarding

financial information

11. The auditor ensures that the person contracting to provide services related to the audit, and, as a rule, other parties to whom copies of the report will be provided, have a clear understanding of the agreed procedures and the conditions for their implementation. In this case, approval is required:

a) the nature of the engagement to perform agreed procedures on financial information, including the fact that the agreed procedures performed will not constitute an audit or review and that, therefore, no opinion will be expressed on the reliability of the financial statements and financial information;

b) the purpose of performing the agreed procedures in relation to financial information;

c) identification of financial information in respect of which agreed procedures will be performed;

d) the nature, timing and extent of the agreed procedures to be performed in relation to financial information;

e) the expected form of the report;

f) restrictions on the distribution of the report (if this restriction conflicts with the requirements of the legislation of the Russian Federation, the auditor should not assume obligations to carry out agreed procedures in relation to financial information).

12. In certain circumstances (for example, where procedures are agreed upon by regulators, industry and the accounting profession), the auditor may not be able to discuss the procedures with all parties to whom the report will be presented. In this case, the auditor may, for example, discuss procedures with interested party representatives, review relevant correspondence with those parties, or provide them with a draft report.

13. The auditor plans the work so that agreed procedures regarding financial information are carried out effectively.

14. The auditor maintains documentation that is important for providing evidence to support the report, and also confirms that the agreed upon procedures were performed in accordance with this federal auditing rule (standard) and the agreed upon conditions.

Procedures and evidence

15. The auditor performs agreed procedures on financial information and uses the evidence obtained as the basis for the report.

16. The procedures used in performing agreed upon procedures in relation to financial information may include:

a) inquiries and analysis;

b) recalculation, comparison and other actions to verify the accuracy of records;

c) observation;

d) inspection;

d) receiving confirmations.

17. The appendix to this federal auditing rule (standard) provides an example of a report containing a description of exemplary procedures that may be performed when performing agreed upon procedures with respect to financial information.

Preparing of report

18. The report should contain a sufficiently detailed description of the purpose of the agreed procedures performed to enable the user to understand the nature and extent of the work performed.

19. The report includes:

a) title of the report;

b) name (surname) of the auditor and his address;

c) the name of the addressee (as a rule, the person who entered into an agreement for the provision of services related to the audit);

d) an indication of the specific financial or non-financial information in relation to which the agreed procedures were performed;

e) a statement that the procedures performed were agreed upon with the recipient of the report;

f) a statement that the work was performed in accordance with the federal auditing rule (standard) applicable to the implementation of agreed procedures in relation to financial information;

g) a statement (if necessary) that the auditor is not independent in relation to the person who entered into an agreement for the provision of audit-related services;

h) an indication of the purpose of performing the agreed procedures in relation to financial information;

i) a list of completed agreed procedures in relation to financial information;

j) description of the facts noted by the auditor (detailed description of errors and comments related to them);

k) a statement that the agreed procedures performed on the financial information do not constitute an audit or review (therefore, the report does not express an opinion on the reliability of the financial statements and financial information);

l) a statement that if the auditor had performed additional procedures, an audit or a review, the auditor might have discovered other issues that require disclosure in the report;

m) a statement that the distribution of the report is limited to the parties who agreed on the procedures performed;

o) a statement (if necessary) that the report relates only to certain elements, accounts, items or other financial and non-financial information and does not generally apply to the financial (accounting) statements of the person who has entered into an agreement for the provision of audit-related services;

o) date of the report;

p) signature.

20. The appendix to this federal auditing rule (standard) provides an example of a report prepared based on the results of the implementation of agreed procedures in relation to financial information.

Application

to rule (standard) N 30

Example of a factual report,

noted during the implementation of agreed procedures

for checking accounts payable

REPORT OF FACTS,

NOTED DURING AGREED PROCEDURES

FOR CHECKING ACCOUNTS PAYABLE

Representatives of the owner (other representatives of the person who has entered into an agreement for the provision of audit-related services).

We have carried out the procedures agreed with you and specified below in relation to accounts payable of the organization "YYY" as of (specify the date) specified in the attached registers (not shown in this example). Our work was carried out in accordance with Federal Rule (Standard) No. 30 and (list the Federal Rules (Standards) of auditing activities applicable to the engagement on agreed upon procedures). The procedures were performed solely for the purpose of assisting you in assessing the reliability of accounts payable and are as follows.

1. We reviewed the arithmetic accuracy of the accounts payable balance sheet as of (specify date) prepared by YYY, and also compared the total with the balance of the corresponding account in the general ledger.

2. We have reconciled the attached list of major suppliers (not shown in this example) and the amounts owed to the relevant parties as of (specify date) with the amounts indicated in the turnover sheet.

3. We have received confirmations from suppliers or sent a request to suppliers to confirm the debt as of (specify date).

4. We compared the confirmations received with the amounts specified in paragraph 2 of this report. In relation to the amounts for which discrepancies were found, we received reconciliations of settlements with the organization "YYY". For the reconciliations received, we identified and included in the list unrecorded invoices and payment documents, the amount for each of which exceeded XXX rubles. We located and examined invoices received after the reporting date and determined that they should, in fact, have been included in the reconciliations.

The results of our work are the following:

a) in relation to paragraph 1 of this report, we have concluded that the total amount has been calculated correctly and is consistent;

b) in relation to paragraph 2 of this report, we have concluded that the audited amounts are consistent;

c) in relation to paragraph 3 of this report, we have concluded that all supplier invoices have been accounted for;

d) in relation to paragraph 4 of this report, we have concluded that the amounts indicated are either consistent or (if there are discrepancies) reconciliations have been prepared by YYY that properly indicate invoices in excess of RUR XXX to explain such discrepancies except for the following:

(detailed statement of comments).

Because these procedures do not constitute an audit or review conducted in accordance with federal auditing rules (standards), we do not express an opinion on the reliability of accounts payable as of (specify date).

If we had performed additional procedures or had we conducted an audit or review of the financial statements in accordance with federal auditing regulations, we may have identified other matters on which we would have provided a report to you.

Our report is provided for the purposes indicated in the first paragraph of this report and also for your information. It must not be used for any other purpose and must not be made available to any other parties. This report concerns only the accounts and items indicated above and does not apply to the financial (accounting) statements of the YYY organization as a whole.

"XX" month 20(XX)

The head (other authorized person) of the audit organization or an individual auditor (last name, first name, patronymic, signature and position).

Head of the assignment for the implementation of agreed procedures (last name, first name, patronymic, signature, number, type of auditor qualification certificate and its validity period).

Auditor's seal.

The purpose of performing agreed procedures in relation to information is for the auditor to carry out audit procedures that have been agreed upon between the auditor, the person who has entered into an agreement for the provision of services related to the audit, and a third party, as well as to provide a report on the facts noted during the performance of agreed procedures in relation to information. .

The auditor performs the agreed procedures regarding the information and uses the evidence obtained as the basis for the report.

The procedures used in carrying out the agreed procedures in relation to the AI ​​may include:

• a) inquiries and analysis;
• b) recalculation, comparison and other actions to verify the accuracy of records;
• c) observation;
• d) inspection;
• d) receiving confirmations.

The report is provided only to those parties who have given their consent to carry out these procedures, since other parties who do not know the reasons for carrying out these procedures may misinterpret their results.

Since the auditor only presents a report, he does not express an opinion on the reliability of the financial information. Users of the report make their own assessment of the agreed procedures performed on the financial information and the facts stated in the report, and draw their own conclusions based on the report.

Agreed procedures regarding payments under the license agreement can be triggered upon the occurrence of the following “signal” events:

• launch of new products into production;
• entering new markets with licensed products;
• commissioning of new production facilities;
• the licensee has become the subject of an acquisition or merger;

• the licensee has financial difficulties;
• changing the accounting system;
• sales volumes of licensed products do not correspond to the industry average;
• changes in the licensee's management personnel.

Carrying out agreed procedures regarding payments

According to the license agreement, it is divided into two stages:

I. Analytical procedures

• 1. Request and analysis of financial statements and tax returns from licensors.
• 2. Identify discrepancies.
• 3. Determining the list of licensors for verification.

II. Detailed check

• 1. Sending a notice to the licensor.
• 2. Study of the licensor's accounting books (General Ledger, sales and cash receipts journals, bank statements, cash tapes, invoices for payment, price lists, shipping documents).
• 3. Inspection of the licensor's retail outlets.
• 4. Identification of discrepancies and their causes (calculation errors, misinterpretation of the wording of the contract, production and sale of products using licensed information media, but not included in the reporting, deliberate understatement of reporting data).

Other services include:

assessment of the fair value of investment assets when acquiring enterprises as property complexes;

conducting marketing research in the case of commercial sale of information technology;

legal advice on intellectual property protection issues;

preparation and analysis of investment projects in the development of new high-tech products;

automation of management accounting of the agency, compilation of the internal database of the agency;

verification of forecast information regarding the value of the enterprise's investment assets for provision to investors or creditors.

Chapter 3 Conclusions

In this chapter, we substantiate the cyclical development of audit and the need to change the traditional audit paradigm, based on confirming the correctness of accounting, to a modern risk-oriented paradigm, which is based on the identification of business risks of an enterprise that impede or may impede its achievement of strategic goals.

When considering the theoretical and methodological content of the category “intellectual assets” for the purposes of accounting, auditing and analysis:

• a) the place and role of intellectual assets in the modern economy are determined;
• b) a list of criteria for classifying assets as intellectual has been established, including artificially created properties of rarity and exclusivity, as well as the ability to bring economic benefits;
• c) the object of audit and analysis of intellectual assets has been identified, which are the economic resources of the organization, which are the result of creative, research or inventive activities, possessing artificially created properties of rarity and exclusivity and the ability to bring economic benefits;
• d) a three-level system of intellectual assets was introduced, characterized by the allocation of a separate class of accounting objects - intellectual quasi-assets;
• e) the composition of audit objects of intellectual assets by category has been determined;
• f) based on a comparative analysis of the content of the concepts “intangible assets” and “intellectual assets”;
• g) the need for a transition to an expanded understanding of intellectual assets in accounting and analytical science is substantiated.

In order to expand the methodology for external audit of intellectual assets:

a classification of types of external audit of the agency was carried out according to the degree of confidence provided by the auditor based on the results of the audit assignment and the nature of information about the subject of study (financial, non-financial);

the purpose, object, grounds and regulatory standards for each type of external audit of the agency have been identified.

An engagement to perform agreed upon procedures may involve the auditor performing certain procedures relating to individual items of financial information (for example, accounts receivable or payable, purchases from related parties, unit sales and profits), a financial statement (for example, a balance sheet) or even a complete package financial statements.

The purpose of an agreed procedures engagement is for the auditor to perform audit procedures that have been agreed upon between the auditor, the subject and any relevant third party, as well as in providing a report (conclusion) on the noted facts.

Since the auditor simply provides a report (conclusion) on the noted facts of the agreed upon procedures, he does not express assurance. Instead, users of the report themselves evaluate the procedures and facts reported by the auditor and draw their own conclusions based on the auditor's work. The report (conclusion) is provided only to those parties who have given their consent to conduct such procedures, since other parties who do not know the reasons for carrying out these procedures may misinterpret the results.

The auditor must comply"Code of Ethics for Professional Accountants." The ethical principles that determine the professional responsibility of the auditor are: integrity; objectivity; professional competence and due care; confidentiality; professional conduct; adherence to technical standards. Independence is not a requirement for an engagement on agreed procedures. However, the terms or objectives of the engagement or national standards may require the auditor to comply with the requirements of the IFAC Code of Ethics regarding auditor independence. If the auditor is not independent, this fact must be noted in the report (conclusion) on the noted facts.

The auditor must perform an engagement on agreed upon procedures in accordance with this ISA and the terms of the engagement. The auditor should ensure that the entity's representatives, and typically other parties to whom copies of the report of findings of fact will be provided, have a clear understanding of the agreed upon procedure and terms of the engagement. Aspects that require agreement.

• - The nature of the engagement, including the fact that the procedures performed will not constitute an audit or review and that, accordingly, no assurance will be expressed.
• - The stated purpose of the assignment.
• - An indication of the financial information in relation to which the agreed procedures will be carried out.
• - Nature, time frame and scope of procedures performed.
• - The expected form of the report (conclusion) on the noted facts.

Restrictions on the dissemination of the report (conclusion) on the noted facts. In case this restriction conflicts legal requirements, the auditor should not undertake this assignment.

In certain circumstances, for example where procedures are agreed between regulators, industry and members of the accounting profession, the auditor may not be able to discuss the procedures with all parties to whom the report will be provided. In this case, the auditor may, for example, discuss the procedures performed with relevant representatives of interested parties, review relevant correspondence with these parties, or provide them with a draft report (conclusion) that will be prepared on the results of the work.

Based on both their own interests and the interests of ent, the auditor must issue an engagement letter documenting the essential terms of the engagement. The engagement letter confirms the auditor's agreement to accept the assignment and helps avoid misunderstandings regarding such matters as the objectives and scope of the engagement, the scope of the auditor's responsibilities and the form of reports issued.

The assignment letter includes:

• - a list of procedures that should be performed as agreed between the parties;
• - A statement that the dissemination of a report of findings of fact will be limited to certain parties who have agreed to the procedures to be followed.

In addition, the auditor may attach to the engagement letter a draft report (opinion) to be provided on the noted facts. A sample assignment letter is given in Appendix 1.

1. Planning.

The auditor must plan the work so that the engagement is completed in an efficient manner.

2. Documentation.

The auditor should document those matters that are important to provide evidence to support the report of findings of fact and evidence to demonstrate that the engagement was conducted in accordance with this ISA and the terms of the engagement.

3. Procedures and evidence.

The auditor must follow agreed procedures and use the evidence obtained as the basis for a report (conclusion) on the facts noted. Procedures used in an engagement to carry out agreed procedures may include:

• - inquiries and analysis;
• - recalculations, comparisons and other checks of the accuracy of records;
• - observation;
• - inspection;
• - receiving confirmations.

Appendix 2 provides a sample report (conclusion) containing a description of exemplary procedures that may be carried out as part of a typical agreed procedures engagement.

4. Preparation of a report (conclusion).

The engagement report on agreed procedures must describe the purpose of the agreed procedures performed during the engagement in sufficient detail to enable the reader to understand the nature and extent of the work being performed. The report (conclusion) on the noted facts must include the following:

• - Name; the addressee (usually the client who hired the auditor to perform the agreed procedures);
• - an indication of the specific financial or non-financial information to which the agreed procedures apply;
• - a statement that the procedures performed were agreed upon with the recipient of the report (conclusion); A statement that the work was performed in accordance with the International Standard on Auditing applicable to engagements to perform agreed procedures or relevant national standards or practices;
• - a statement that the auditor is not independent of the entity, if appropriate;
• - an indication of the purpose for which the agreed procedures are being carried out;
• - list of specific procedures performed;
• - a description of the facts noted by the auditor, including a detailed description of the errors and exceptions found;
• - a statement that the procedures performed do not constitute an audit or review and therefore do not represent an expression of assurance;
• - a statement that if the auditor had performed additional procedures, an audit or a review, he might have discovered other issues that require coverage in the report;
• - a statement that the distribution of the report (conclusion) is limited to the parties who agreed on the implementation of the procedures;
• - a statement (if necessary) that the report relates only to certain items, accounts, items or financial and non-financial information and that it does not apply to the financial statements of the entity as a whole.

Appendix 2 contains a sample report (conclusion) on the noted facts, compiled in connection with the assignment to implement the agreed procedures in relation to financial information.

Agreed-Upon Procedures

Agreed procedures - a test that has been agreed upon by the auditor, the entity, and possibly any third party. The subject and scope of such an audit, as well as the nature of the presentation of its results, are determined by agreement of the parties and may differ from those that are typical for a regular audit. Performing agreed upon procedures does not require the auditor to provide assurance regarding the reliability of the financial information. Based on the results of the agreed procedures, the auditor does not draw up a conclusion, but prepares a report on the basis of which users of the financial statements can, taking into account its results, independently draw conclusions about the reliability of the financial statements.

The concept of “agreed-upon procedures” is associated with the issue of coordination of audit procedures between the auditor and the person who entered into an agreement to provide audit-related services, as well as a third party. These procedures include: inquiries and analysis; recalculation, comparison and other actions to verify the accuracy of records; observation, inspection, confirmation.

Before carrying out these procedures, the auditor agrees with the customer on the following issues:

• · the nature of the engagement, indicating that when performing the agreed procedures, the auditor cannot express an opinion on the reliability of the financial statements;
• · the purpose of implementing the agreed procedures;
• · composition of financial information when carrying out agreed procedures;
• · scope of agreed procedures and time frame for their implementation;
• · report format and restrictions on its distribution.

After this, the agreed procedures can be carried out by the auditor both in relation to individual indicators (for example, sales volume, divisional profit, the amount of receivables or payables, etc.) and in relation to any element of the financial statements (for example, an income statement and losses) or financial (accounting) statements as a whole.

At the same time, in the report, the auditor describes in detail the objectives of the agreed procedures so that users can evaluate the nature and extent of the work performed. The report is presented only to those parties (users) who have agreed to carry out the agreed procedures.

Sample of the final part of the auditor's report on the facts noted during the implementation of agreed procedures (Audit's Report On Factual Findings of Agreed-Upon Procedures):

“... because these procedures do not constitute an audit or review conducted in accordance with federal auditing rules (standards), we do not express an opinion on the reliability of the financial and non-financial information for period XXX (or as of XXX).

If we had performed additional procedures or had we conducted an audit or review of the financial statements in accordance with federal auditing regulations, we may have identified other matters on which we would have provided a report to you.

Our report is provided for the purposes indicated in the first paragraph of this report and also for your information. It must not be used for any other purpose and must not be made available to any other parties. This report concerns only the information specified above...”