Compilations

A compilation is the lowest level of service that a CPA can provide for a client’s financial statements. Using information provided by the entity’s management, we prepare compiled financial statements for clients on a monthly, quarterly, or annual basis.

This level of service offers no assurances as to whether material or significant adjustments are necessary for the financial statements to be presented in accordance with generally accepted accounting principles or other basis of accounting such as the cash basis or income tax basis. Our report on compiled statements, in part, states:

We have not audited or reviewed the accompanying financial statements and, accordingly, do not express an opinion or any other form of assurance on them.

A compilation requires significantly less time than a review or audit engagement because fewer procedures are required. Professional requirements are minimal:

  • The CPA must possess an adequate level of knowledge about the accounting principles and practices of the client’s industry and have a general understanding of the nature of the client’s business.
  • The CPA is required to read the compiled financial statements and consider whether they are in appropriate form and free from obvious errors.

For internal-use, compiled financial statements are often adequate. Depending on your credit history, your bank or other creditors may accept compiled financial statements.