Audits, Reviews & Compilations

Audits, Reviews & Compilations2019-04-29T17:17:15+00:00

AAScorecardFinancial statements provide an EKG of the heart of your business.

Finances are at the heart of your business.  Given the importance of your financial statements, careful consideration of the level of assurance provided by your CPA is warranted. The type of scorecard used by your CPA is based on the level of service provided.

Financial statements come with a variety of choices including the types, framework (i.e. basis or standards), and level of assurance.  These choices are aimed at providing the users (management, banks, investors, etc.) with decision-relevant insight into the health and operations of the business. Financial statements can be for management’s use only or for the most sophisticated investor.  Financial statements can include multiple statements (such as the balance sheet, income statement, etc.) or just one statement. They can include or omit footnotes. They can also be based on many different frameworks such as cash basis, accounting principles generally accepted in the United States of America (U.S. GAAP), and international financial reporting standards (IFRS).

AssuranceServiceChartRegardless of the types of financial statements, the accounting framework used, or the level of service provided, our team’s industry-specific expertise is designed to increase your efficiencies and provide excellent client service. The “hands-on” involvement and ongoing communication from our partners are coupled with tailored solutions to meet your needs.

Once you’ve decided the types of and basis for your financial statements, the next question is, “What level of service do you and the other users of your financial statements need?”

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Comparison of Levels of Assurance

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Audits, Reviews & Compilations

Comparing service levels.
Financial Statement Preparation Compliation Review Audit
Assurance Provided None None Limited negative assurance High level of reasonable assurance
Intended Audience Business owners to manage the business Lenders and other outside parties not requiring assurance Lenders and other outside parties desiring a basic level of assurance Creditors, investors, and other outside parties desiring high level of comfort
Appropriate For Potentially some lender’s documentation for small loans Initial or lower amounts of financing with significant collateral in place Growing businesses seeking larger levels of financing Growing businesses seeking high levels of financing or selling a business
Report Issued None Yes Yes Yes
Frequency (Generally) Monthly, quarterly, or annually Monthly, quarterly, or annually Monthly, quarterly, or annually Monthly, quarterly, or annually

Solutions Simplified

Down-to-earth descriptions of our services.

Audits

CRI’s team will begin with an understanding of your business plus its processes and internal controls that are used to develop your financial statements.  We will then use that understanding to develop a program for testing through inquiry, analytics, and detailed substantive verification procedures (e.g. vouching and tracing items to details and back-up).  The goal of the audit is to determine—with a high level of reasonable assurance—if the financial statements are free of material misstatement and fairly stated in light of the applicable framework. An audit report is the highest level of assurance to any party, including third-parties.

Reviews

CRI’s team analytically reviews financial information and makes inquiries of your organization’s management team — in an effort to determine whether material modifications should be made to the financial statements in order for them to conform generally accepted accounting principles. A review engagement does not entail detailed verification and testing or gathering an understanding of your internal controls, but it does provide limited, negative assurance to third-parties such as insurance companies and financial institutions.

Compilations

A compilation is the most basic attestation service provided by CRI or any CPA firm (i.e. it’s our most basic form of report). Our team compiles the business’ books and records but does not perform any verification (not even inquiry or analytics) of the financial data. It may be used internally and is also acceptable to some lenders and third-parties.

Financial Statement Preparation

Financial statement preparation is our most basic level of service. Our team does not perform any verification of the financial data, and we pull the numbers together in your chosen format.  The financial statements will be marked with “no assurance is provided.” While you may share the financials with third-parties, the financial statement preparation service is really aimed at meeting management’s internal needs.