When the auditors have performed an audit and are asked to report on the client's compliance with aspects of contractual agreements,which of the following is correct?
A)They may do so and provide reasonable assurance as to compliance.
B)They may do so and provide negative assurance as to compliance.
C)They only may do so when details of the contracts have been audited.
D)They may not do so.

Question

Quizplus · Accepted Answer

Auditors can report on a client's compliance with aspects of contractual agreements by providing negative assurance. Negative assurance means the auditor is not aware of any material modifications that should be made to the statements for them to be in conformity with the terms of the agreement. This is less strong than reasonable assurance, which involves more extensive procedures and is not typically provided in the context of compliance with specific contractual agreements.

When the Auditors Have Performed an Audit and Are Asked