A limited review of financial statements is an audit restricted to an examination either for a limited period or of a limited part of the records. A review does not contemplate obtaining an understanding of the entity's internal control; assessing fraud risk; tests of accounting records by obtaining sufficient appropriate audit evidence through inspection, observation, confirmation, or the examination of source documents (for example, cancelled checks or bank images); and other procedures ordinarily performed in an audit. Accordingly, a review does not provide assurance that we will become aware of all significant matters that would be disclosed in an audit. Therefore, a review provides only limited assurance that there are no material modifications that should be made to the financial statements in order for the statements to be in conformity with generally accepted accounting principles.
The definition of nonattest services is very inclusive. It includes, for example, preparation of the client's depreciation schedule and preparation of journal entries even if management has approved the journal entries. I have confirmed these examples directly with the AICPA ethics division. The definition of nonattest services includes preparation of tax returns.
An Oregon Engagement Letter for Review of Financial Statements by an accounting firm is a formal agreement that outlines the scope and terms of engagement between the accounting firm and its client for conducting a review of the client's financial statements. This letter serves as a contract and sets forth the responsibilities of both parties involved in the engagement. The main purpose of the Oregon Engagement Letter for Review of Financial Statements is to establish the terms and conditions under which the accounting firm will perform the review of the client's financial records. It ensures a clear understanding between the client and the accounting firm regarding the objectives, limitations, and deliverables of the engagement. Types of Oregon Engagement Letters for Review of Financial Statements: 1. Standard Oregon Engagement Letter for Review of Financial Statements: This type of engagement letter outlines the general terms and conditions for conducting a review of financial statements. It includes details such as the duration of the engagement, the agreed-upon procedures to be followed during the review, and the responsibilities of both parties. 2. Oregon Engagement Letter for Review of Financial Statements with Specific Procedures: In certain cases, the client may require specific procedures to be performed during the review of financial statements. This type of engagement letter will include detailed instructions on the agreed-upon procedures, providing clarity on the expectations of the client. 3. Oregon Engagement Letter for Review of Financial Statements for Specialized Industries: Different industries may have unique accounting practices or specific reporting requirements. In such cases, a specialized engagement letter tailored to the particular industry's needs is used. It may include additional understanding of industry-specific regulations, policies, and guidelines. Key elements typically found in an Oregon Engagement Letter for Review of Financial Statements include: — Introduction: Name and address of the accounting firm and the client, along with the engagement's effective dates. — Objectives: Clearly defined objectives and purpose of the review engagement, emphasizing the limited assurance provided by the accounting firm. — Scope: Specific procedures to be performed during the review, detailing the extent of the examination and the nature of evidence to be obtained. — Responsibilities: Stating the responsibilities of both the accounting firm and the client, including providing accurate and complete financial records, ensuring compliance with laws and regulations, and maintaining internal controls. — Deliverables: Description of the expected deliverables, such as the final report, containing the findings and the firm's conclusion. — Fee Structure: Agreement on the fees and related expenses to be paid by the client for the review engagement, including billing terms and any additional costs. — Confidentiality: A clause ensuring the confidentiality of client information and the accounting firm's responsibility to safeguard such data. — Termination Clause: Conditions and procedures to terminate the engagement by either party. In conclusion, an Oregon Engagement Letter for Review of Financial Statements by an accounting firm is a crucial document that establishes the obligations, rights, and expectations of both the client and the accounting firm during the review process. It ensures clarity, transparency, and accountability throughout the engagement, enabling a smooth and professional working relationship.An Oregon Engagement Letter for Review of Financial Statements by an accounting firm is a formal agreement that outlines the scope and terms of engagement between the accounting firm and its client for conducting a review of the client's financial statements. This letter serves as a contract and sets forth the responsibilities of both parties involved in the engagement. The main purpose of the Oregon Engagement Letter for Review of Financial Statements is to establish the terms and conditions under which the accounting firm will perform the review of the client's financial records. It ensures a clear understanding between the client and the accounting firm regarding the objectives, limitations, and deliverables of the engagement. Types of Oregon Engagement Letters for Review of Financial Statements: 1. Standard Oregon Engagement Letter for Review of Financial Statements: This type of engagement letter outlines the general terms and conditions for conducting a review of financial statements. It includes details such as the duration of the engagement, the agreed-upon procedures to be followed during the review, and the responsibilities of both parties. 2. Oregon Engagement Letter for Review of Financial Statements with Specific Procedures: In certain cases, the client may require specific procedures to be performed during the review of financial statements. This type of engagement letter will include detailed instructions on the agreed-upon procedures, providing clarity on the expectations of the client. 3. Oregon Engagement Letter for Review of Financial Statements for Specialized Industries: Different industries may have unique accounting practices or specific reporting requirements. In such cases, a specialized engagement letter tailored to the particular industry's needs is used. It may include additional understanding of industry-specific regulations, policies, and guidelines. Key elements typically found in an Oregon Engagement Letter for Review of Financial Statements include: — Introduction: Name and address of the accounting firm and the client, along with the engagement's effective dates. — Objectives: Clearly defined objectives and purpose of the review engagement, emphasizing the limited assurance provided by the accounting firm. — Scope: Specific procedures to be performed during the review, detailing the extent of the examination and the nature of evidence to be obtained. — Responsibilities: Stating the responsibilities of both the accounting firm and the client, including providing accurate and complete financial records, ensuring compliance with laws and regulations, and maintaining internal controls. — Deliverables: Description of the expected deliverables, such as the final report, containing the findings and the firm's conclusion. — Fee Structure: Agreement on the fees and related expenses to be paid by the client for the review engagement, including billing terms and any additional costs. — Confidentiality: A clause ensuring the confidentiality of client information and the accounting firm's responsibility to safeguard such data. — Termination Clause: Conditions and procedures to terminate the engagement by either party. In conclusion, an Oregon Engagement Letter for Review of Financial Statements by an accounting firm is a crucial document that establishes the obligations, rights, and expectations of both the client and the accounting firm during the review process. It ensures clarity, transparency, and accountability throughout the engagement, enabling a smooth and professional working relationship.
