A Type 1 report covers the design of controls at a point in time; a Type 2 report also covers their operating effectiveness over a period. The user entity's auditor can rely on the report in its own audit.
Source: GDS 3402, BDS 402
Related terms
Internal controlProcesses and controls designed by management to provide reasonable assurance regarding the effectiveness of operations, the reliability of financial reporting and compliance with laws and regulations.IT general controlsControls over access management, change management, IT operations and system development that ensure information systems operate reliably.Assurance engagementAn engagement providing assurance, against specified criteria, on a subject matter other than an audit or review of historical financial information.Adverse opinionThe opinion in which the auditor states that the financial statements are not presented fairly, where misstatements are both material and pervasive.Agreed-upon proceduresAn engagement in which the practitioner performs procedures agreed with the entity and, where relevant, a third party, and reports only the findings without providing assurance.Analytical proceduresThe evaluation of financial information through analysis of plausible relationships among financial and non-financial data.
Last updated: October 31, 2026 · This definition is for general information only.