Many organizations call on us to audit the financial statements to provide them with the type of assurance usually required to obtain bank loans and to offer management vital information for internal decision making.
This service and compilations are widely used by privately held companies. In a review, the CPA applies analytical procedures to a company's financial statements and makes inquiries of management in order to issue an accountant's review report on the company's financial statements. An accountant's review report may be used by a variety of third parties, including creditors or regulatory agencies.
In a compilation engagement, the CPA assembles financial statements using the client's data but does not provide assurance on the financial statement. Compilations are useful in assisting small, nonpublic companies in preparation of the financial statements.