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The main objective of the Agreed-Upon Procedures Report

The reasoning behind agreed-upon procedures is for the auditor to conduct audit-like procedures, agreed upon by the auditor, the entity, and potentially relevant third parties. The auditor’s role is to report factual findings without expressing any form of assurance. Instead, users of the report are expected to independently assess the procedures and findings presented by the auditor and make their own judgments based on the auditor’s work. This report is limited in its distribution, only accessible to those who have agreed upon the procedures to avoid potential misinterpretation of the results by those unaware of the rationale behind the procedures.

General principles of an Agreed-Upon Procedures Engagement

Depending on the terms of the engagement, auditors adhere to the Accounting and Corporate Regulatory Authority (“ACRA”) Code of Professional Conduct and Ethics for Public Accountants and Accounting Entities (“ACRA Code”) and/or Singapore Standard on Quality Control (“SSQC”) 1 in agreed-upon procedures and engagements. The ethical principles governing the auditor’s professional responsibilities for such engagements encompass integrity, objectivity, professional competence, due care, confidentiality, professional behavior, and adherence to technical standards.

While independence is not a mandatory requirement for agreed-upon procedures engagements, it may be necessary in certain situations based on the engagement’s terms or the relevant Financial Reporting Standard. If independence is not maintained, the report of factual findings will explicitly mention this fact. The auditor is responsible for conducting the agreed-upon procedures engagement in alignment with this SSRS (Statement on Standards for Related Services) and in accordance with the agreed-upon terms of the engagement.

Agreed-Upon Procedures for Company Use

In cases where an organization is not mandated to undergo a formal audit or receive an assurance opinion in line with assurance standards, opting for agreed-upon procedures (AUPs) focused on specific financial or non-financial risks can offer a cost-effective means of providing confidence to the entity’s preparer. The outcomes can be complemented with professional insights, although they do not constitute a formal assurance opinion, given that the work’s scope is limited to AUPs.

Agreed-Upon Procedures for Third-party Use

Additionally, agreed-upon procedures can offer assurance to third parties regarding an entity’s adherence to regulatory or contractual obligations. When practitioners undertake such engagements, they must assess the heightened risks associated with the third party’s vested interest in the report. In certain cases, it may be preferable to define the scope of work in a manner that aligns clearly with ISRS 4400 rather than committing to providing subjective professional judgments. It is also essential for practitioners to carefully determine the terms and conditions governing the third party’s utilization of the report.

What assistance does Premia TNC provide?

Our Agreed-Upon Procedures (AUP) services provide specific, objective assessments for specific financial, operational, or compliance concerns in sections where required while ensuring cost-effective and precise evaluations. Premia TNC offers assurance, expert guidance, and clear terms and conditions.

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Frequently Asked Questions

Agreed-Upon Procedures Services

What are Agreed-Upon Procedures engagements?

Customized assessments with defined procedures to provide factual findings without assurance.

When should I choose Agreed-Upon Procedures over a full audit?

For cost-effective, specific assessments, third-party assurance, or regulatory compliance.

How is the scope of work determined in Agreed-Upon Procedures?

You define it to match your needs or relevant standards with the practitioner’s guidance.