Forming an Opinion in SOC Engagement | Information System and Controls ISC CPA Exam. скачать в хорошем качестве

Forming an Opinion in SOC Engagement | Information System and Controls ISC CPA Exam.

In this video, we explain how to form an opinion in a SOC engagement as covered on the Information System and Controls ISC CPA exam. Start your free trial: https://farhatlectures.com/ Here's a quick summary of the video: Introduction (0:00-0:13): The video introduces the role of a service auditor in a SOC engagement, explaining the purpose and overall objective of these engagements. Key Players (0:16-0:57): It describes the entities involved: the user entity (e.g., Farhat Lectures), the service organization (Best IT Support), and their respective auditors (PWC and KPMG). SOC 1 vs SOC 2 (1:35-2:14): The video explains the difference between a SOC 1 report (internal control over financial reporting) and a SOC 2 report (privacy, security, etc.). Auditor's Role and Opinion (2:14-2:53): The service auditor (KPMG) provides an opinion on the accuracy and adequacy of the service organization's controls. Evidence and Misstatements (3:38-5:26): The auditor evaluates evidence, assesses misstatements, and determines if these could influence the decisions of users relying on the report. Opinion Focus (5:38-7:30): The auditor's opinion covers the fair presentation of the system's description, the suitability of the design of controls (SOC 1 & SOC 2 Type 1), and the effective operation of controls (SOC 2 Type 2). SOC 1 & SOC 2 in Detail (7:30-10:37): A detailed comparison of SOC 1 (internal control over financial reporting) and SOC 2 (Trust Services Criteria) engagements, including their objectives and the areas they cover. Multiple Choice Question (10:38-12:35): The video concludes with a multiple-choice question to highlight the key differences between SOC 1 and SOC 2 engagements. In a SOC (Service Organization Control) engagement, the auditor provides an opinion on the effectiveness of the controls implemented by the service organization. The type of opinion issued depends on the findings of the audit and the level of assurance provided. Here are the typical opinions issued in a SOC engagement: Unqualified Opinion (Clean Opinion): This is the most favorable opinion and indicates that the auditor has concluded that the controls at the service organization are suitably designed and operating effectively to achieve the specified control objectives. An unqualified opinion provides assurance to users of the SOC report that the controls are reliable and can be relied upon to achieve the organization's objectives. Qualified Opinion: A qualified opinion indicates that the auditor has identified one or more deficiencies in the design or operating effectiveness of the controls. While the overall control environment may be effective, there are specific areas where improvements are needed to achieve the control objectives fully. The auditor may provide recommendations for addressing the identified deficiencies and achieving compliance with the relevant standards and criteria. Adverse Opinion: An adverse opinion is issued when the auditor concludes that the controls at the service organization are not suitably designed or operating effectively to achieve the control objectives. This opinion indicates significant deficiencies in the control environment that could impact the reliability of the organization's operations and the integrity of its data. An adverse opinion raises serious concerns and may lead to a loss of trust and confidence in the service organization's ability to manage risks effectively. Disclaimer of Opinion: A disclaimer of opinion is issued when the auditor is unable to form an opinion on the effectiveness of the controls due to limitations in the scope of the audit or insufficient evidence. This opinion may result from factors such as incomplete documentation, restricted access to information, or other circumstances that prevent the auditor from reaching a conclusion. A disclaimer of opinion indicates uncertainty about the reliability of the organization's controls and may prompt users of the SOC report to seek additional assurances or take further actions to mitigate risks. The opinion issued in a SOC engagement is a critical component of the SOC report and provides valuable insights into the effectiveness of the controls implemented by the service organization. It helps stakeholders make informed decisions about the organization's risk management practices and the reliability of its services. #cpaexaminindia #cpaexam #cpareviewcourse