In a compilation engagement, the accountant presents in the form of financial statements information that is the representation of management (owners) without undertaking to express any assurance on the statements. In other words, using management's records, the accountant creates financial statements without gathering evidence or opining about the validity of those underlying records. Because compiled financial statements provide the reader no assurance regarding the statements, they represent the lowest level of financial statement service accountants can provide to their clients. Accordingly, standards governing compilation engagements require that financial statements presented by the accountant to the client or third parties must at least be compiled.
Florida Report from Review of Financial Statements and Compilation by Accounting Firm A Florida Report from Review of Financial Statements and Compilation by an Accounting Firm is a comprehensive document that provides a detailed analysis and assessment of a company's financial statements. This report is crucial for businesses operating in Florida, as it offers valuable insights into their financial performance, risks, and overall credibility. There are two distinct types of Florida Reports from Review of Financial Statements and Compilation by Accounting Firm, namely: 1. Review Report: This type of report is conducted by an accounting firm to provide limited assurance on the accuracy and reliability of a company's financial statements. It involves analysis, inquiry, and analytical procedures performed by the firm to determine if the financial statements conform to Generally Accepted Accounting Principles (GAAP). The review report provides valuable insight into any potential material modifications that should be made to the financial statements for alignment with accounting standards. 2. Compilation Report: A compilation report is a more basic review conducted by an accounting firm. It involves gathering, classifying, and summarizing financial information provided by a company without providing any assurance or opinion on the accuracy of the financial statements. The compilation report serves as a representation of the company's financial position based on the information provided by the company itself. The Florida Report from Review of Financial Statements and Compilation by an Accounting Firm typically includes the following key components: 1. Introduction: This section provides an overview of the purpose, scope, and limitations of the report, clearly outlining the responsibilities of both the company and the accounting firm. 2. Management’s Responsibility: This section emphasizes the responsibility of the company's management in preparing the financial statements and ensuring their accuracy and completeness. 3. Auditor's Responsibility: This section outlines the duties and responsibilities of the accounting firm in conducting the review or compilation process. It highlights the procedures performed and the level of assurance provided in the respective report. 4. Financial Statements: The report presents the reviewed or compiled financial statements, including the balance sheet, income statement, statement of cash flows, and notes to the financial statements. These statements are analyzed for any non-compliance with GAAP or significant departures from accounting principles. 5. Auditor's Opinion/Findings: This section provides the opinion of the accounting firm based on the review or compilation conducted. In the case of a review report, it outlines any material modifications that should be made, while a compilation report emphasizes the lack of assurance. 6. Disclosures: The report may include additional disclosures as required by regulatory bodies or specific circumstances. In summary, a Florida Report from Review of Financial Statements and Compilation by an Accounting Firm provides crucial information on a company's financial performance and adherence to accounting standards. It helps businesses in Florida make informed decisions, maintain credibility with stakeholders, and comply with legal and regulatory requirements.
