Financial Statements Review, Compilation and Other Agreed-upon Procedures
Financial Statement Review - Sometimes companies wish or need to have an accounting firm involved with their financial statements. For example, your bank, factor, other creditor or government agency, may request that your accountants be involved to provide additional assurance regarding the reliability or credibility of your company's financial statements. In these circumstances, we may conduct a review engagement. A review engagement provides less assurance and adds less credibility to the financial statements than an audit, but more than compiled financial statements. The review process involves a limited amount of analytical work and questioning of administrative employees, but does not involve the extensive testing and external validation procedures provided by an audit.
Financial Statement Compilation – A compilation is the assembly of information provided by your organization into the form of a financial statement without audit or review. Clients requesting financial statement compilation services usually have no audit or review requirement from creditors for their financial statements, but some stakeholders may still want a CPA involved in the presentation of the financial statements.
| A I C P A |
Florida Institute of CPAs |
Members of the American Institute of
Certified Public Accountants
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Members of the Florida Certified
Public Accountants |
Other Agreed-upon Procedures – A restricted-use report is one that is intended only for specified parties. The need for restriction on the use of a report may result from the purpose of the report, the nature of the procedures applied in its preparation, the basis of or assumptions used in its preparation, the extent to which the procedures performed generally are known or understood, or the potential for the report to be misunderstood when taken out of the context in which it was intended to be used.
Examples of reasons for such reports include:
- The subject matter of the auditor's report or the presentation being reported on is based on measurement or disclosure criteria contained in contractual agreements or regulatory provisions that are not in accordance with generally accepted accounting principles or another comprehensive basis of accounting.
- The accountant's report is based on procedures specifically designed and performed to satisfy the needs of specified parties who accept responsibility for the sufficiency of the procedures.
[Please note that we DO NOT perform audit of financial statements engagements, but we can provide assistance with your audit examination by preparing information for and interfacing with your selected outside auditors.]
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