When we’re hired for an audit on a specific test or business process, we agree upon the engagements that will be performed. These agreed-upon procedures are carried out under some special circumstances and include situations like acquisitions, lenders wanting a report on the borrowers finances, landlord looking for a report on tenants finances, status review of a company or advice on financial structure, evaluation operational efficiency, processes and so on.
An AUP engagement uses procedures similar to an audit, but on a limited scale. It can be used to identify specific problems that require immediate action. When performing an AUP engagement, your CPA makes no formal opinion; he or she simply acts as a fact finder. The report lists:
● The procedures performed, and
● The CPA’s findings
It’s the user’s responsibility to draw conclusions based on those findings. AUP engagements may target specific financial data (such as accounts payable, accounts receivable or related party transactions), nonfinancial information (such as a review of internal controls or compliance with royalty agreements), a specific financial statement (such as the income statement or balance sheet) or even a complete set of financial statements.
● Contracts related to EU research framework programmes
● Reconciliation of figures based on computation of accounting records or legally assessed financial statements (e.g. in connection with financial covenants certificates for credit institutions).
Contracts where no overall assessment is delivered, but assessments of individual circumstances are made, do not fall within the scope of agreed-upon procedures. In such cases, we collaborate with you to find the appropriate audit assignment for the specific case.