An agreed-upon procedures engagement is an engagement in which an auditor is engaged to carry out those procedures of an audit nature to which the auditor and the entity and any appropriate third parties have agreed and to report on factual findings. The recipients of the report form their own conclusions from the report by the auditor.
The report is restricted to those parties that have agreed to the procedures to be performed since others, unaware of the reasons for the procedures may misinterpret the results. For example, an agreed-upon procedures engagement may be commissioned by an entity which is acquiring another business. The entity may engage an audit to report on specific aspects of the business that it is buying.