Another MCQ I'm confused about. The answer says that documentation of inquiry and analytical procedures does not include legal representation letter. but then the explanation lists that very document as part of the review. Isn't this a contradiction?
The documentation of the inquiry and analytical procedures on a review engagement should include all of the following except:
A. additional procedures performed in response to significant unexpected differences arising from the analytical procedure and the results of such additional procedures.
B. communications, whether oral or written, to the appropriate level of management regarding fraud or noncompliance with laws and regulations that come to the accountant's attention.
C. legal representation letter.
D. management representation letter.
The accountant's documentation in a review engagement should include the following:
The engagement letter
The analytical procedures performed
The expectations when the expectations are not otherwise readily determinable from the documentation of the work performed, and factors considered in the development of those expectations
Results of the comparison of the expectations to the recorded amounts or ratios developed from recorded amounts
Management's responses to the accountant's inquiries regarding fluctuations or relationships that are inconsistent with other relevant information or that differ from expected values by a significant amount
Any additional procedures performed in response to significant unexpected differences arising from the analytical procedure and the results of such additional procedures
The significant matters covered in the accountant's inquiry procedures and the responses thereto
Any findings that are significant
Unusual matters that the accountant considered during the performance of the review procedures, including their disposition
Communications, whether oral or written, to the appropriate level of management regarding fraud or noncompliance with laws and regulations that come to the accountant's attention
The representation letter<
see this is included
.