Developing an Engagement Plan Once stakeholder commitment is established, a formal engagement plan will be developed.

This takes the form of a formal work plan and might simply be an elaboration of the proposals and associated documentation developed to date. The work plan needs to address:

formal timeframe commitments; budgetary allocation; participant role descriptions; output indicators; evaluation approaches and success measures; and contingency strategies.

In addition, the engagement plan can serve as a formal, or informal contract with the public. In areas where participation has been poor because of low levels of trust, making this document participative, or public, can be useful to demonstrate commitment to the engagement approach by the agency and provide a benchmark against which agency performance can be observed by stakeholders and potential participants. As the implementation process moves forward, the formal engagement plan can serve as the basis for supporting documentation such as:

the marketing and promotion strategy; the technical specifications and, if necessary, contracting documents for systems development; evaluation frameworks; the final report; and the evaluation report.

Good documentation, from the outset of the project, will greatly assist in the process of post-project review and project termination. ELEMENTS OF AN ASSURANCE ENGAGEMENT The important elements involved in assurance engagement are: Independence Professionalism

Figure 1 SOURCE: Assurance Services: Definition and Interpretive Commentary. AIPCA Committee on Assurance Services, Final Report. Information or context improvement Decision makers The CPA should be independent in order to provide an assurance service; that is, he or she should have no vested interest in the information reported on. The CPA's only interest should be the accuracy of the information, not whether the information portrays results favorable or unfavorable to either the entity that prepares the information or the one that uses it.

An assurance service is a professional service, meaning it draws on the CPA's experience, expertise, and judgment. It is based on the skills brought to bear in more traditional services, such as measurement, analysis, testing, and reporting. Information in an assurance service can be financial or nonfinancial, historical or forward-looking, discrete data or information about systems, internal or external to the decision maker. The information's context relates to how it is presented. An assurance service improves the information or its context by providing assurance about its reliability, increasing its relevance, or making it easier to use and understand. Decision makers are the users of the information and immediate beneficiaries of the assurance service. They might be internal to an entity, such as the board of directors, or a trading partner, such as a creditor or customer. The goal of an assurance service is to improve the information or its context so that decision makers can make more informednd presumably betterdecisions. The decision maker need not be the party engaging the CPA or paying for the service. The needs of decision makers are evolving. For decades their needs were generally met by periodic cost-based financial statements. As in formation technology advances and needs be come more decision-specific, decision makers are likely to:

Replace their need for/b> periodic information historical data cost-based information financial information static statements

With a need for/b> real-time or continuous data forward-looking data value-based information comprehensive data that includes nonfinancial information searchable databases

Assurance services, how they are delivered, and the types of information they deal with are evolving to meet these changing needs. Although the needs of each decision maker are unique, in research done by the Special Committee on Assurance Services, decision makers expressed keen interest in better information about topics such as: Business risks Product quality Performance measures Quality of processes and systems Strategic plan execution Government performance TYPES OF ASSURANCE SERVICES

The Special Committee on Assurance Services identified hundreds of assurance services that CPAs provide. It also identified several services that it believed would be of particular appeal to decision makers in the near future. They included the following. Comprehensive risk assessments. The CPA identifies and assesses the various risks facing an organization, such as the operating environment, operating systems, or information systems. The risks might be internal, external, or regulatory. The CPA can help prioritize the risks and assess the entity's efforts to control or mitigate risks faced. Business performance measurement. Many organizations use, or should use, data to run their businesses other than that emanating from the financial reporting system. The service deals with identifying or providing explicit assurance on the financial or nonfinancial measures used to evaluate the effectiveness or efficiency of the organization's activities. While CPAs have historically been involved in the development of financial statement information, their skills and knowledge can add similar value to the creation of other information that can monitor the organization's results and its effectiveness in implementing strategic plans.

Electronic commerce. As more business is conducted electronically (via the Internet or in business-to-business electronic data interchange systems) participants have concerns about the integrity and security of data transmitted in furtherance of those transactions. An assurance service can help to address the risks and promote the integrity and security of electronic transmissions, electronic documents, and the supporting systems. One such service, CPA WebTrust, provides explicit assurance about the disclosure of an entity's business policies and about the controls over privacy and information integrity in consumer purchases over the Internet. Systems reliability. As information technology advances, it becomes increasingly common for critical information to be produced and acted on electronically. Accordingly, decision makers need confidence that the information is continuously reliable. There is an increased need for assurance that systems are designed and operated to produce reliable data in such areas as information about customers, suppliers, and employees, project costing, rights and obligations related to contractual agreements, and competitors and market conditions. In systems reliability engagements, CPAs provide assurance about the design and operation of such systems. Elder care services. The CPA assists the increasing population of older adults with a wide range of services such as bill paying, providing assurance that health care providers are providing services in conformity with the client's criteria, and consulting on care alternatives and how to pay for them. The CPA provides independent, objective information to protect vulnerable clients from potentially unethical individuals and businesses as well as more traditional services (such as financial control) for nontraditional clients. Policy compliance. The CPA provides assurance that a company complies with its own policies. The policiesuch as ones involving treatment of women or minorities, conflicts of interest, animal testing, environmental matters, or customer service-might be based on internal concerns, calls for social accountability, or laws and regulations. Trading partner accountability. The CPA provides assurance that the client's trading partnersuch as suppliers, customers, or joint venture partnersave appropriately fulfilled their responsibilities. Common situations involve collecting rents or royalties based on sales made by another entity or agreements regarding use of lowest prices or specific billing practices. Mergers and acquisitions. The CPA applies the types of services done on a client's records and practices to a potential acquisition. He or she can, for example, provide insights into the acquisition target's business risks, appropriateness of accounting methods, the value of its assets, or the adequacy of its systems and controls. good engagement plan should include or consider the following issues: Budget. An adequate budget is essential, including setting aside time for staff who

need to be involved Timeline. Be realistic about how long things take and always allow more rather than less time for planning and for people to get involved. Remember that time is needed between events for work to be completed and to be taken to the next stage. Key dates and actions including when final decisions need to be taken, and by whom, are all part of the planning process and should be part of the engagement plan. Methods. There are many different participatory/engagement techniques which can be adopted, and indeed a range of methods are useful at different stages of the consultation process. For further information on the different methodologies and techniques available a useful publication to refer to would be The Community Planning Handbook by Nick Wates, published by Earthscan Publications Ltd (2000). Careful planning is required to ensure that the various methodologies adopted are complementary and work together to make the overall process successful. Organisational Logistics. Participatory processes require a lot of practical arrangements, especially in terms of user-friendly briefing materials and suitable venues. In additional to logistical practicalities, consideration should be given to the choice of venue with respect to the positive and negative potential effects that this may have on the process and its consequent outcomes. Communication Strategy. Communication is important throughout the engagement process. It is needed at the outset to get people interested, during the process so they are kept abreast of what is happening, at the end and by way of follow-up, to ensure that people are aware of what difference the process has made. Follow up. Initial planning needs to consider right from the start: - How the results will be used, how it will feed into decision-making systems, and

how the final outcomes will be reported back to the participants and others - How you will know whether the process has been a success success criteria can be reformulated from the original objectives of the process Appropriate follow up should be carried out as soon as reasonably possible after the engagement event takes place. Defining Outputs. Outputs are the tangible products of any process. Outputs include such things as reports, meetings or workshops, exhibitions and leaflets: useful in themselves, but alone will not meet the purpose of the engagement process. Defining the desired outputs of the engagement process is a crucial part of the engagement plan as it helps the process designer to select the most appropriate methodology (different participatory techniques are designed to produce different types of outputs); forces people to think through how the outputs will achieve the desired outcomes (how will this meeting help achieve our overall outcomes?) and ensures that the right outputs are produced at the right time.

d. capable of working successfully, it can be organized relatively easy g. in a thrifty or frugal manner; with economy. 2. as regards the efficient use of income and wealth:economically feasible proposals. 3. as regards one's personal resources of money: He's quite welloff economically.
i.

A board of directors is a body of elected or appointed members who jointly oversee the activities of a company or organization. Other names include board of governors, board of managers, board of regents, board of trustees, and board of visitors. It is often simply referred to as "the board".

j. Synonyms: sufficient, adequate, enough These adjectives mean being what is needed without being in excess: has sufficient

income to retire comfortably; bought an adequate supply of food; drew enough water to fill the tub. k. 1. Properly or sufficiently qualified; capable: a competent typist. 2. Adequate for the purpose: a competent performance. 3. Law Legally qualified or fit to perform an act. 2. Summary: 1.Efficiency means doing the things right whereas Effectiveness is about doing the right things. 2.Efficiency focuses on the process or means whereas Effectiveness focuses on the end. 3.Efficiency is restricted to the present state whereas effectiveness involves thinking long term. 4.Organizations have to be both effective and efficient in order to be successful. Attestation-- a consulting service in which a CPA expresses a conclusion about the reliability of a written statement that is the responsibility of someone else Professional skepticism in auditing implies an attitude that includes a questioning mind and a critical assessment of audit evidence without being obsessively suspicious or skeptical.

Agreed Upon Procedures Engagements (AT 201), such as verify-ing inventory quantities and locations. Examination or Review of Financial Forecasts and Projections (AT 301), such as analysis of prospective or hypothetical what iffinancial statements for some time period in the future (e.g., whatwould the financial statements look like next year for two compa-nies considering a merger?). Examination or Review of Pro Forma Financial Information (AT401), such as retroactively analyzing the effect of a proposed orconsummated transaction on the historical financial statementsas if that transaction had already occurred (e.g., what would the consolidated financial statements look like if two companiesmerged last year?). Reporting on an Entitys Internal Control over FinancialReporting (AT 501). Compliance Attestation Engagements (AT 601), such as ascer- taining a clients compliance with debt covenants.

Examination of Managements Discussion and Analysis (AT 701). 6 Part One The Contemporary Auditing Environment Professional skepticism includes being alert to, for example:

Audit evidence that contradicts other audit evidence obtained. Information that brings into question the reliability of documents and responses to inquiries to be used as audit evidence. Conditions that may indicate possible fraud. Circumstances that suggest the need for audit procedures in addition to those required by the ISAs.