assurance

1. . A positive declaration on an *audit obj ective. Assurance can cover a wide range of matters, from the *fair presentation of *financial statements to the effective operation of *internal controls. Assurance does not offer the certainty of a *guarantee; indeed, to offer absolute assurance in an auditing context is generally unfeasible, owing to the existence of *risk. It has been observed that auditors "can never be 100 per cent certain of the information on which their opinion or report is based" (Flint, 1988, 112). Auditors therefore tend to form their judgments on the results of a mixture of *sample testing of large *audit populations and *compliance testing of procedures and internal controls. Neither of these categories of *audit testing offers absolute assurance. Auditors, in consequence, tend to prefer to use the term "reasonable assurance." The term assurance has become increasingly popular following its use in the *American Institute of Certified Public Accountants’ 1997 report Serving the Public Interest: A New Conceptual Framework for Auditor Independence (AICPA, 1997). The report identified various means of improving the quality of *financial reporting and related information. 2. In the United Kingdom, a branch of the insurance industry in which policies compensate the death of the policy holder. Further reading: AICPA (1997); Gray and Gray (2000)