Not as extensive than an audit, but more engaging than a compilation, a review engagement involves applying analytical procedures to the financial statements, and making inquiries about several aspects of the business as well as making inquires of the company's management team. If we sense an in consistency between financial statements or supporting information and our inquiries we may need to perform additional procedures.
Occasionally, banks, government, insurance companies and other businesses require financial statements to process applications or get an overall status. This mode of service is usually fulfills the requirement when no assurance is needed by third party.
Compilations involve presenting management’s information in a financial statement form. This form of service provides NO ASSURANCE to management or third party about the accuracy of the Financial Statements. It also includes a disclaimer that states that no opinion is being given on these financial statements. The financial statements typically included are:
Third Parties like Banks, government and Insurance companies often require statements with a limited Review. Reviews typically cover a shorter period of time, e.g 3 months. This mode of service is ideal when organizations require limited assurances on mentioned financial statements.
Review of Financial Statements involves presenting management’s information with LIMITED assurance
that no material changes need to be made. This form of service comes with a report stating that limited assuranceis provided on the financial statements. It also CPA obtaining an understanding of the industry and its relevant financial benchmarks. The financial statements typically covered are
In compiling financial statements for a client, we present information that is the "representation of management" and expresses no opinion or assurance on the statements. Compilations don't require inquiries of management or analytical procedures. Instead, we rely on our knowledge of accounting principles and a general understanding of your business.