Securimax Limited (Securimax) has been an audit client of KFP Partners (KFP) for the past 15 years. Securimax is based in Waterloo, Ontario, where it manufactures high-tech armor-plated personnel carriers. Securimax often has to go through a competitive market tender process to win large government contracts. Its main product, the small but powerful Terrain Master, is highly specialized, and Securimax does business only with nations that have a recognized, democratically elected government. Securimax maintains a highly secure environment, given the sensitive and confidential nature of its vehicle designs and its clients.
Clarke Field has been the engagement partner on the Securimax audit for the last five years.
The board of Securimax is considering changing from an audit engagement to a review engagement and has approached the audit partner, Clarke Field, to discuss the implications of this change. Clarke suggests that KFP could perform the review engagement.
Required
What is a review engagement? Why would a review be appropriate for a set of financial statements for Securimax?