How long does a limited assurance engagement take?

Elapsed time is driven by how fast you answer queries, not by the standard, and the practitioner's fieldwork is a small part of it. If your working papers are complete before fieldwork starts, the engagement runs to plan. If they are not, it stalls while evidence is assembled.

What does an assurance provider actually test in year one?

In year one they test the disclosures inside the ASSA 5010 first-year scope: Scope 1 and Scope 2 emissions, governance disclosures, and specified strategy paragraphs on climate risks and opportunities. The work runs in a predictable order, from understanding your reporting process and your boundary, through sampling source documents and reperforming calculations, to written representations at the end.

What do we have to do ourselves and what can be done for us?

Anything that is a management judgement or a statutory act stays with you, and anything that is technical execution can be done for you. You keep access to source documents, approval of the boundary and the significant judgements, the governance record, and the signatures on the declaration and representation letter. Methodology, calculations, working papers, drafting the disclosures and managing assurance queries can all be done for you.

Glossary›Assurance, audit evidence and working papers›Assurance engagement letter

Glossary term

Cluster A · A41

Tier 1 · differentiator

Assurance engagement letter

Definition

An assurance engagement letter is the written agreement between the entity and the practitioner that records what is being assured, at what level, against which criteria, and who is responsible for what. Under ASSA 5000 the practitioner must agree these terms in writing before proceeding. It is the document that defines the scope of the engagement.

ASSA 5000

· paragraphs 85 to 88 ·

In force

On this page

In practice
What the assurer does with it
Commonly confused with
Sources
Related terms
Related questions

Cluster

A · Assurance, audit evidence and working papers, 47 terms

In practice

Controllers treat the engagement letter as a procurement formality and sign it. It is the single most consequential document in the engagement, because everything the assurer later declines to do traces back to a scope line in it.

Paragraph 85 requires the terms to record the objective and scope of the engagement including precisely which sustainability information is inside it, whether the engagement is limited or reasonable assurance, the applicable criteria, that the engagement is conducted under ASSA 5000, the practitioner’s responsibilities, management’s responsibilities, the expected form of the report and that it may be modified, and management’s agreement to provide written representations at the end.

Three of those are worth reading closely before signing. The identification of the sustainability information is where ASSA 5010’s phasing becomes contractual: check that it matches the reporting year you are actually in. The criteria clause is where your basis of preparation gets locked in, and if your basis of preparation is not finished when you sign, you are agreeing to be measured against a document you have not written. The written representations clause is the CFO’s personal commitment at the end of the engagement, and the representations requested will be broader than in a financial statement audit because there is less hard evidence in the file.

Paragraph 86 requires the practitioner to consider, on a recurring engagement, whether the terms need updating. In this regime they will need updating every year for the first four, because ASSA 5010 changes the scope annually. A rolled-forward engagement letter is a live risk here in a way it is not for a financial statement audit.

What the assurer does with it

The practitioner drafts it, and they will not start fieldwork without it signed. During the engagement they refer to it whenever a boundary question arises: whether a subsidiary is in scope, whether a voluntary metric printed alongside the assured figures is covered, whether a restated prior year is inside the work.

They accept a change to the terms only with reasonable justification, under paragraphs 87 to 88, and any revised terms must be documented. What they reject is a mid-engagement request to narrow the scope after they have found a problem in the area being narrowed: that is treated as a scope limitation and it flows to the report rather than disappearing from it.

The procedural point entities miss: the letter is also where the practitioner records management’s responsibility for the sustainability information. Where an external adviser prepared the disclosures, the assurer will still want the letter to state that management takes responsibility. An entity that signs and then behaves as though the adviser owns the numbers creates an independence and representation problem for itself, not for the adviser.

Commonly confused with

The financial statement audit engagement letter. If your auditor holds both engagements, these may arrive as one document with two schedules or as two letters. Either is acceptable, but check that the sustainability scope is stated with its own ASSA 5010 reporting-year language and is not folded into general audit wording.