Financial Statements - Compilations
A compilation is the lowest level of service that a
CPA can provide for a client’s financial statements.
Using information provided by the entity’s management,
we prepare compiled financial statements for clients on
a monthly, quarterly, or annual basis. This level of
service offers no assurances as to whether material or
significant adjustments are necessary for the financial
statements to be presented in accordance with generally
accepted accounting principles or other basis of
accounting such as the cash basis or income tax basis.
Our report on compiled statements, in part, states:
We
have not audited or reviewed the accompanying financial
statements and, accordingly, do not express an opinion
or any other form of assurance on them. A compilation
requires significantly less time than a review or audit
engagement because fewer procedures are required.
Professional requirements are minimal:
- The CPA must possess an adequate level of
knowledge about the accounting principles and
practices of the client’s industry and have a
general understanding of the nature of the client’s
business.
- The CPA is required to read the compiled
financial statements and consider whether they are
in appropriate form and free from obvious errors.
For internal-use, compiled financial statements
are often adequate. Depending on your credit
history, your bank or other creditors may accept
compiled financial statements. |
