Successful Businesses Demand Professionally Prepared Financial Statements
Financial statements are the dashboard businesses need in order to navigate properly. Without strong financial reporting and controls, a company cannot adequately measure its performance and financial position. Also, if the company has outside investors or creditors, there may be additional demands for transparency and accuracy in reporting.
Financial statement assurance services are designed to help companies meet their reporting needs and obligations. While sometimes basic compiled financial statements are adequate, in many cases certain stakeholders – like banks, shareholders, and government authorities – may require that an independent, licensed CPA firm perform a review or audit in order to establish some level of assurance that the financials are materially correct.
Financial Statements Assurance Services:
- Compilation – Compiled financial statements are the entry level of financial reports. They measure performance over a period of time and financial position as of a period-end. In a compilation engagement, our CPAs assist the company with producing financial statements in conformity with Generally Accepted Accounting Principles (GAAP) or some other appropriate method of accounting. However, no procedures are done to provide assurance that the financials are materially correct.
- Review – A review is the next incrementally better form of assurance service, where ratio analysis and certain other analytical procedures are performed on compiled financials to establish a limited degree of assurance that they are materially correct. A review does not require the CPA to obtain an understanding of internal controls, to assess fraud risk, or to test transactions for completeness and accuracy. Consequently, a review only provides limited assurance.
- Audit – An audit is the most thorough form of financial statement assurance service. In an audit the same procedures are performed as in a review but with the addition of internal controls analysis and testing, assessing fraud risk, and testing certain transactions to allow our CPAs to attest to the material accuracy of the financials with a greater level of assurance.
Timely and accurate financial statements are critical for business success. Don’t let reporting weaknesses or failures handicap your business. Contact one of our Partners for assistance.