5️⃣Reporting & Disclosure
5. Attestation Reporting & Level of Disclosure
The attestation standards established by the American Institute of Certified Public Accountants provide guidelines, but not strict rules, for how we present the results of our procedures. We're not providing an opinion, like in a Financial Statement Audit, but instead presenting the findings from the agreed-upon procedures.
In practical terms, this means that the procedures are determined by the Engaging Party. It is the responsibility of the Engaging Party to craft procedures that fulfill its customers’ and potentially regulatory needs. It is the responsibility of the attestation provider to provide objective results (called Findings) to the procedures determined by the Engaging Party and to ensure findings are not misleading.
In a similar vein, it is also up to the Engaging Party to determine the level of disclosure of certain components in the report. For example, the Engaging Party has the flexibility to present units balances and/or collateralization ratios. Neither is necessarily required, but generally, the more disclosure, the better.
This important aspect of the attestation standard means that you, as management, have options in how you want to present the results. Whether your preference is to display the findings in terms of unit balances, collateralization ratios, or another format entirely, we can facilitate it as long as the attestation requirements are met. This flexibility extends across all areas of our process, most notably in the final presentation of the report.
Once your preferences have been outlined, it is a good idea to discuss them with your attestation provider to ensure your procedures fulfill all attestation standards and are not potentially misleading. In practice, the attestation provider also helps craft/tweak the procedures to be performed to ensure they align with the general attestation standards.
Typical Items of Consideration
Presenting Unit Balances of Assets/Liabilities vs. only Collateralization Ratios
Including an Appendix for Remaining Risks and Further Considerations for the readers of the reports
Grouping liabilities if they are “pooled” to by the same pool of assets and vice vers
Ultimately, after all determinations have been made and procedures have been executed, the attestation provider will draft and issue the report.
5. Management Outputs
5. Example Scenarios
Collateralization Ratios Only vs. Unit Balances and Collateralization Ratios
Management Appendix Example
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