ISA 210 — Agreeing the Terms of Audit Engagements
ISA 210 is an international pronouncement addressing audit preconditions and the agreement of engagement terms. It addresses the preconditions for an audit, including an acceptable reporting framework and management acknowledgement of its responsibilities, and the agreement of engagement terms. A properly agreed engagement letter records the audit’s objective, scope and respective responsibilities.
Worked example
Before accepting, the auditor obtains management’s acknowledgement of its responsibilities and agrees the engagement terms.
Common mistake
An engagement letter cannot cure the absence of an acceptable reporting framework or management’s required acknowledgement of its responsibilities.
Where it appears in your exams
| Qualification | Exam | Relationship | Period |
|---|---|---|---|
| ACCA | AA | Supporting | September 2026–June 2027 |
| ACCA | AAA (INT) | Supporting | September 2026–June 2027 |