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Compilations |
Compilations
Compilations are the most basic form of
financial statements that carry an accountant’s opinion letter. A full set of financial statements will include
balance sheet, statement of income, statement of cash flows and notes to the
financial statements. A compilation does not involve any audit
or review of client accounting data.
No independent verification of any financial data is performed. Instead, information provided by the client
is utilized to prepare financial statements in the proper form with necessary
footnote disclosures in accordance with Generally Accepted Accounting
Principles (GAAP). In the process of
completing a compilation, we may be required to post certain adjustments,
such as depreciation and amortization, into the client accounting records. Many banks and insurance companies will accept compiled financial statements for small and/or closely-held businesses. Larger companies, or those with significant loans, accounts receivable and/or inventory, may be required to issue financial statements with a higher degree of authenticity, such as a review or audit. Generally, a compilation may be sufficient to satisfy the minimum requirements of a bank loan agreement or an insurance company performance bond. Preparation of compiled financial
statements is usually an inexpensive proposition, unless significant effort
is required to properly formulate financial data and obtain information for
financial statement disclosures. Our
fees are set at a low and fixed affordable fee, assuming sufficient support
is received from our client in the data-gathering stage. An example of a compilation opinion: We have compiled the accompanying balance
sheet of XYZ Company as of December 31, 2008 and the related statements of
income and changes in retained earnings and cash flows for the quarters then
ended, in accordance with standards established by the American Institute of
Certified Public Accountants. A compilation is limited to presenting in
the form of financial statements information that is the representation of
management. 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. |
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Copyright © 1999 - 2009 Regalia & Associates |
Last Modified January 5, 2009 |
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