Financial statement compilations and reviews are often required by business owners, banks, other stakeholders or regulatory bodies.

Compilations and reviews can only be performed in Texas by licensed CPA firms, and specifically, CPA firms who participate in Texas State Board of Public Accounting and AICPA peer reviews. These peer reviews help ensure that CPA firms are meeting professional standards and that the services provided are of high quality.

Compilations are designed to present financial statements in accordance with a framework of accounting, such as GAAP.  Compilations can also present financial statements on the cash basis of accounting, modified cash basis of accounting or tax basis of accounting. Compilations are an attest service but do not provide assurance. Compilations are generally lower cost than other attest services such as reviews or audits, and are often sufficient for small businesses in their reporting to banks or regulatory agencies.

Reviews are designed to provide limited assurance that financial statements are presented in accordance with a framework of accounting. Review procedures include inquiry and analytical procedures, and the CPA performing the service must be independent. Reviews are significantly less expensive than audits, which provide a high level of assurance that financial statements are free from material misstatement.

The cost of a compilation or a review can vary based on the circumstances of the requesting party; factors that can have significant impact on the cost of compilations and reviews include:

• Quality of accounting records
• Complexity of business and industry
• Industry specific nuances related to financial statement presentation
• Basis of accounting required for presentation and whether adjustments are necessary to present the financial statements in accordance with the basis of accounting
• Extent to which footnotes are necessary (compilation only)

DK Partners is happy to assist with interpreting the requirements and expectations set by banks or regulatory bodies and helping you determine whether adjustments to the basis of accounting and/or footnotes are necessary when presenting your financial statements.  Learn more about our compilation and review services.

Our goal is client satisfaction and providing value. We achieve that by ensuring we are performing the service that best meets your needs, working efficiently and communicating effectively.