When a CPA prepares or assists in preparing financial statements, they are required under professional standards to issue a report on those financial statements.
This report can be one of three types:
The type of report is determined by mutual agreement between the client and the CPA.
This determination usually depends on many factors, such as the needs of the client, requirements of creditors or investors, the size and complexity of the business, and other considerations.
Privately-held companies often opt for reviewed or compiled statements.
However, agreements with lenders and other business relationships may require audited statements for private companies.
Shareholders, creditors, and private investors often need assurance that financial statements accurately represent the true financial position of a company.
We offer two levels of assurance to meet your needs. Audits provide the highest level of assurance and reviews provide limited assurance.
Auditing standards require that we plan and perform an audit to obtain reasonable assurance about whether the financial statements are free of material misstatement.
An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.
An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.
Based on our findings, we issue a report on whether the financial statements are fairly stated and free of material misstatements.
An audit allows you to accomplish the following:
- Satisfy shareholders, employees, customers, suppliers, and other interested parties as to the credibility of the financial statements.
- Satisfy ERISA requirements (401(k) or other retirement plans).
- Substantiate compliance with banking covenants.
- Help deter and detect material fraud and errors.
- Facilitate the purchase or sale of a business.
Arthur C. Seideman Accountancy Corporation has been providing audit services at reasonable fees to a wide range of industries.
Our audit approach utilizes experienced auditors and a focus on important areas that make the audit process more productive and cost-effective.
Accordingly, we are in a position to provide you with timely, experienced service at reasonable fees.
Reviews consist principally of inquiries of company personnel and analytical procedures applied to financial data.
It is substantially less in scope than an audit.
A review does not require an evaluation of the company's internal controls, verification of data with third parties, or physical inspection of assets as does an audit.
Reviewed financial statements must include all required footnotes and other disclosures.
A compilation of financial statements is limited to presenting in the form of financial statements information that is the representation of management or owners.
A key characteristic of a compilation is that no opinion or any other form of assurance is expressed on the fairness of the presentation of the financial statements.
Accordingly, we are not required to make inquiries or perform procedures to verify or review management furnished information.
However, though not required, our firm frequently communicates to management aspects of the financial data (positive and negative) that may warrant attention.
