Assurance services refer to professional services provided by certified public accountants (CPAs) and other qualified professionals to enhance the reliability and credibility of information used by decision-makers. These services are designed to improve the quality and transparency of financial and non-financial information, giving stakeholders confidence in the accuracy and completeness of the information being presented. Assurance services include both financial statement audits and a broader range of activities that involve the evaluation and verification of information.

Here are key aspects and examples of assurance services:

1. **Financial Statement Audits:**
– Financial statement audits are a common form of assurance service. In a financial statement audit, an independent auditor examines a company’s financial statements and provides an opinion on whether the statements are presented fairly in accordance with accounting standards. The auditor assesses the company’s internal controls and tests transactions to ensure the accuracy and completeness of financial reporting.

2. **Review Engagements:**
– In a review engagement, the auditor performs procedures to obtain limited assurance about whether any material modifications should be made to the financial statements for them to be in accordance with accounting standards. While the level of assurance is lower than in an audit, a review engagement provides some level of confidence to users of the financial statements.

3. **Compilation Services:**
– Compilation services involve the preparation of financial statements based on information provided by the company’s management. Unlike audits and reviews, a compilation does not provide any assurance regarding the accuracy or completeness of the financial information. It is a less formal service intended to assist companies in presenting financial information in a proper format.

4. **Agreed-Upon Procedures (AUP) Engagements:**
– In an agreed-upon procedures engagement, the auditor performs specific procedures agreed upon by the client and other relevant parties. The results of these procedures are reported, providing users with information without the expression of an overall opinion. AUP engagements are often used for specific testing or examination purposes.

5. **Internal Control Assessments:**
– Assurance services may include assessments of an organization’s internal controls. This involves evaluating the design and effectiveness of internal controls over financial reporting to identify and address weaknesses in control processes.

6. **Compliance Audits:**
– Compliance audits assess whether an entity is adhering to specific laws, regulations, or contractual agreements. These audits provide assurance regarding compliance with external requirements.

7. **Performance Audits:**
– Performance audits focus on evaluating the efficiency and effectiveness of an organization’s programs, operations, or activities. The goal is to provide assurance on whether resources are used efficiently and objectives are being achieved.

8. **IT Assurance:**
– With the increasing reliance on information technology, assurance services extend to IT systems. This includes evaluating the controls and security measures in place to ensure the reliability of financial and operational data.

9. **Sustainability and ESG Assurance:**
– As sustainability and environmental, social, and governance (ESG) reporting become more prevalent, assurance services may involve assessing the reliability of non-financial information related to an organization’s environmental and social performance.

10. **Third-Party Attestation:**
– Organizations may engage auditors to provide third-party attestation regarding certain assertions, such as the security and privacy controls of a service organization (SOC reports).

Assurance services contribute to building trust among stakeholders by providing independent and objective assessments of information. The specific nature of the assurance service depends on the needs and requirements of the entity seeking assurance and the relevant professional standards.