1. What is “Assurance”? Explain the value we obtain from lay man’s assurance.

The Merriam-Webster dictionary defines "assurance" as the state of being

assured, such as being free of uncertainty. It is the process of determining
whether something is true, and it can be used to check the accuracy of a
statement. Furthermore, assurance can be a personal guarantee to another
individual that goods or services are of superior quality. In layman's terms, the
value we receive is the trust and certainty that a set of standards and criteria are
met (Merriam-Webster, n.d.).
2. What is an Assurance Engagement?
Assurance Engagement is one in which a practitioner is involved in
communicating a conclusion for the purpose of increasing the intended user’s
confidence other than the responsible party about the outcome of a subject
matter’s evaluation against criteria (Sinra, 2022)
3. Why do we conduct Assurance Engagements? Why is it an essential function in
the practice of our profession?
The purpose of assurance engagement is to allow professionals and external
audit firms to carry out their works and communicate their opinion based on the
degree of assurance that they are engaging in. It is an essential function in the
practice because it verifies if the organization has duly complied with the
specified requirements or criteria in all material aspects.
4. Differentiate the following:
1. Reasonable Assurance Engagement and Limited Assurance Engagement
- Limited assurance engagement gathers lesser evidence but
sufficient for a negative form of expression of the conclusion. On
the contrary, in a reasonable assurance engagement, the
practitioner communicates the conclusion in a positive manner.
Additionally, the level of assurance acquired in a limited assurance
engagement is lower compared to reasonable assurance
engagement. There is also a greater risk in a limited assurance
management (ICAEW, 2022).
2. Assertion-based Engagements and Direct Reporting Engagements
- In an assertion-based engagement, the responsible parties
performs the evaluation of the subject matter and the information
will be reported. This subject matter information includes the
assertion of the responsible party. Then, the practitioner will give an
assurance conclusion on the assertion. However, in a direct
reporting engagement, the responsible party reports the subject
 matter directly to the intended users together with the assurance
report (ICAEW, 2022).
5. What are the Elements of an Assurance Engagement? Give and explanation and
include why such element is necessary in the completion of such engagement.
The elements of an assurance engagement include (1) A three-party relationship,
involving: the practitioner, a responsible party, and intended users. This element
is necessary because it performs operations or gives information for the benefit
of or relevant to users, and they are also responsible for the subject matter. (2)
Appropriate subject matter. This plays a vital role in engagement because it
focuses on the credibility and suitability of the evidence. Such evidence must be
relevant to the engagement and should assist in the completion of the entire
process. (3) Suitable criteria assist the parties to understand how the practitioner
has evaluated the subject matter as stated in the given conclusion. (4) Sufficient,
appropriate evidence to support the conclusion. In this process, the practitioner
must have an attitude of professional skepticism to acquire sufficient and
appropriate evidence whether the subject matter is free from material
misstatement. (5) A conclusion within a written report (ICAEW, 2022).
6. What are Non-assurance services? Give examples and explain.
Non-assurance services are those services that does not include auditing,
reviewing of financial statements, or other assurance services. It may include
accounting and bookkeeping, which is responsible for keeping the books of the
company and ensuring that all transactions are being recorded. They also
accomplish financial statements quarterly or annually. Administration services is
also a non-assurance service as it only oversees the operations of the business
and does not review the financial statements. Tax and financial planning also
falls under this classification because they only analyze the financial
circumstances of the business in order to determine what actions they need to
take to pay the lowest taxes possible (Kagan, 2022).
References
Definition of assurance. (n.d.). Dictionary by Merriam-Webster: America's most-trusted
online dictionary. https://www.merriam-webster.com/dictionary/assurance
Sinra. (2022, June 16). What is the objective of assurance engagement?
Wikiaccounting. Retrieved September 6, 2022, from
https://www.wikiaccounting.com/what-is-the-objective-of-assurance-engagement/
The five elements of an assurance engagement. (n.d.). Welcome to ICAEW.com |
ICAEW.
https://www.icaew.com/technical/audit-and-assurance/assurance/process/
scoping/assurance-decision/the-five-elements
Attestation vs direct reporting. (n.d.). Welcome to ICAEW.com | ICAEW.
https://www.icaew.com/technical/audit-and-assurance/assurance/process/
scoping/assurance-decision/attestation-vs-direct-reporting
Kagan, J. (2022, May 28). Tax planning. Investopedia. Retrieved
https://www.investopedia.com/terms/t/tax-planning.asp#:~:text=Tax%20planning
%20is%20the%20analysis,an%20individual%20investor's%20financial%20plan.