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Agreed-upon procedures are used when a client needs an independent external auditor to perform specific agreed upon procedures or tests and report on their findings. The procedures might relate to specified elements in the financial statements or accounts. The users of the report, agree on the procedures to be conducted that the user believes are suitable for their needs. The user takes responsibility for the adequacy of the procedures. The auditor does not issue an opinion or any other form of assurance. The user of the report draw their own conclusion on the results or findings of the procedures.

An example of an agreed upon procedure would be to compare a bank account balance in the general ledger to the bank statements for that account, trace the clearance of significant reconciling items to a subsequent bank statement and note the timely clearance of reconciling items or any unusual circumstances of reconciling items that have not cleared.