FINANCIAL STATEMENT SERVICES
External agencies as well as internal stakeholders may have several reasons for wanting a CPA's report on your annual financial statements, so we provide all three levels of attestation under professional standards to meet your needs.
Highest Level of Assurance
An audit provides the highest level of assurance; it is a methodical and objective examination of the financial statements based on risk. An audit includes obtaining an understanding of internal controls, testing of selected transactions, and the third-party verification of specific information. Based on our findings, we issue a report as to whether the financial statements are fairly stated and free of material misstatements.
A review report expresses limited assurance in the form of the statement: "We are not aware of any material modifications" for the financial statements to be in conformity with the Generally Accepted Accounting Principles (GAAP). Less extensive than an audit, a review engagement consists primarily of analytical procedures and various inquiries of your management team. If the financial statements or supporting information appear inconsistent or otherwise questionable, additional procedures may be necessary. Reviewed financial statements must include all required footnotes and other disclosures.
Why might a business request a review engagement? If your third-party users (banks, grantors, etc.) will be satisfied by it, it can be a good middle ground, providing the advantages of a CPA's technical expertise without the work and expense of an audit.
In compiling financial statements for a client, we present information that is the "representation of management" and express 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.
Which report should I use?
Each type of financial statement report may suit specific circumstances, depending on requirements of financial statement users, as well as meet budgetary needs.
Understanding each report's unique strengths and weaknesses can help you choose the most appropriate one. Please call if you have questions about which type of report is right for you.