When a CPA examines a client's projected financial statements, the CPA's report should: included such

procedures as we considered necessary to evaluate both the assumptions used by management and the
preparation and presentation of the projection

A CPA is required to comply with the provisions of Statements on Standards for Attestation Engagements
(SSAE) when engaged to: Review management's discussion and analysis (MD&A) prepared
pursuant to rules and regulations adopted by the SEC.

Statements on Standards for Attestation Engagements provide guidance with respect to Compiling a
client's financial

projection that presents a

hypothetical course of action

A report on agreed-upon procedures should include a list of the procedures performed (or reference
thereto) and the related findings.

In an attest engagement, use of the accountant's report should be restricted to specified parties in all of
the following situations 1.When reporting directly on the subject matter and a written assertion has not
been provided.

2.When reporting on an agreed-upon procedures engagement.

3.When the criteria used to evaluate the subject matter are appropriate for only a limited number of
parties.

A WebTrust engagement is an attestation engagement designed to measure transaction integrity,

information protection, and disclosure of business practices. When an unmodified report is issued, the
client may add the CPA WebTrust Seal to its Web site, indicating that its site is a reasonably safe and
private place for e-commerce.

The practitioner's report on agreed-upon procedures related to management's assertion about the
entity's compliance with specified requirements is intended solely for the use of specified parties. Thus,
the report should include a statement of limitations on the use of the report.

An examination of a financial forecast is a professional service that involves: 1.Evaluating the

preparation of the prospective financial statements,

2.Evaluating the support underlying the assumptions,

3.Evaluating the presentation of the prospective financial statements in conformity with AICPA
guidelines, and
4.Issuing an examination report.

An accountant's compilation report on a financial forecast should include a statement that: There
will usually be differences between the forecasted and actual results.

Which of the following is a conceptual difference between the attestation standards and generally
accepted auditing standards? The attestation standards provide a framework for the attest function
beyond historical financial statements.

Accepting an engagement to examine an entity's financial projection most likely would be appropriate if
the projection were to be distributed to:A bank with which the entity is negotiating for a loan.

An accountant's report on a review of pro forma financial information should include a: Reference to
the financial statements from which the historical financial information is derived.

An accountant's standard report on a compilation of a projection should include a 1. Statement

that a compilation of a projection is limited in scope.

2. Disclaimer of responsibility to update the report for events occurring after the report's date.

3. Separate paragraph that describes the limitations on the presentation's usefulness.

4. Compilation does not include evaluation of the support of the assumptions underlying the forecast.

Attestation standard 1. The work shall be adequately planned and assistants, if any, shall be properly
supervised.

2. The report shall identify the assertion being reported on and state the character of the engagement.

3. Sufficient evidence shall be obtained to provide a reasonable basis for the conclusion that is expressed
in the report.

When an accountant is requested to report on the results of performing a review of management's

assertion Negative assurance may be expressed

When an accountant examines a financial forecast that fails to disclose significant assumptions used to
prepare the forecast, the accountant should issue an adverse opinion

Partial presentations are presentations of prospective financial information which would not
ordinarily be appropriate for general use because they omit one or more of these essential elements: (a)
sales or gross revenue, (b) gross profit or cost of sales, (c) unusual or infrequently occurring items, (d)
provision for income taxes, (e) discontinued operations or extraordinary items, (f) income from
continuing operations, (g) net income, (h) earnings per share, and (i) significant changes in financial
position.
Attest engagements may result in reports related to compliance with laws and regulations

When an accountant compiles a financial forecast, the accountant's report should include a(an): Caveat
(warning) that the prospective results of the financial forecast may not be achieved.

A SysTrust engagement is an attest engagement that provides assurance on the reliability of any defined
electronic system.

An accountant's standard report on a compilation of a projection should include a statement that:

1. The accountant has no responsibility to update the report for future events and
circumstances.

2. The compilation of a projection is limited in scope.

3. There will usually be differences between the projected and actual results.

When an accountant compiles projected financial statements, the accountant's report should include a
separate paragraph that: Describes the limitations on the projection's usefulness.

If one or more of the significant assumptions do not provide a reasonable basis for the financial
statements an adverse opinion would be issued.

A pro forma financial statement is one that shows historical financial statements as they would have
been if a hypothetical event had occurred.

A qualified opinion might be issued if AICPA presentation guidelines were not followed

A financial forecast is appropriate for general use but a financial projection is not.

Which of the following is a conceptual similarity between generally accepted auditing standards and the
attestation standards? The requirement that the CPA be independent in mental attitude is included in
both sets of standards.

The practitioner and specified parties should agree upon the procedures to be performed by the
practitioner

Which of the following procedures should an accountant perform during an engagement to compile
prospective financial statements? Make inquiries about the accounting principles used in the
preparation of the prospective financial statements.

Which of the following components is appropriate in a practitioner's report on the results of applying
agreed-upon procedures? A list of the procedures performed, as agreed to by the specified parties
identified in the report.

When an accountant accepts a compilation engagement, he or she should indicate that it is limited in
scope and would not include an opinion or assurance on the projected financial statements or the
related assumptions.
Which of the following items should be included in prospective financial statements issued in an
attestation engagement performed in accordance with Statements on Standards for Attestation
Engagements? All significant assumptions used to prepare the financial statements.

When an accountant compiles projected financial statements, the accountant's report should include a
separate paragraph that: Describes the limitations on the usefulness of the projection.

Which of the following statements should be included in a practitioner's report on the application of
agreed-upon procedures? A statement referring to standards established by the AICPA.

A CPA is required to comply with the provisions of Statements on Standards for Attestation Engagements
when engaged to: Provide assurance on investment performance statistics prepared by an
investment company on established criteria.