Audit
An audit of an organization's financial statements is designed to obtain reasonable assurance as to whether the financial statements are free from material misstatement. We perform detailed testing and analysis of the organization's financial records to make that determination. The objective of an audit is for us to form an opinion as to whether the financial statements are fairly presented in all material respects. An audit is usually requested by regulatory agencies, outside investors or creditors such as a bank.
Review
A review consists principally of inquiries of company personnel and analytical procedures applied to financial data. It is substantially less in scope than an audit. No detail account or transaction testing is performed. The review report indicates that we are not aware of any material changes that need to be made to the financial statements in order for them to be presented in conformity with generally accepted accounting principles.
Compilation
A compilation of financial statements involves assembling client financial records to present the company's financial statements in accordance with a comprehensive basis of accounting. The financial statements can be full disclosure (i.e., footnotes attached) or omitted disclosure (i.e., no footnotes attached). The accountant performs no account testing or analytical review. The report indicates that we have not audited or reviewed the financial statements and, therefore, do not express an opinion or any other form of assurance on the financial statements.
Agreed Upon Procedures and
Special Purpose Reports
As the name implies, agreed upon procedures are engagements where an agreement is made between the accountant and the client as to the procedures the accountant is to perform with respect to the client's financial or non-financial records. The purpose is to determine if certain balance sheet accounts are properly stated on the financial statements, or whether specific procedures, processes or specific items of compliance are being followed. After completion of the engagement, we issue a report indicating the work we performed and our findings.
