Audit and Assurance
An audit provides the highest level of assurance. An audit is a methodical review and objective examination of the financial statements, including the verification of specific information as determined by the auditor or as established by general practice.
Our work includes a review of internal controls, testing of selected transactions, and communication with third parties. 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…
Review – Limited Assurance
Less extensive than an audit, but more involved than a compilation, a review engagement consists primarily of analytical procedures we apply to the financial statements, and various inquiries we make of your company’s management team. If the financial statements or supporting information appear inconsistent or otherwise questionable, we may need to perform additional procedures.
A review doesn’t require us to study and evaluate your company’s internal controls or verify data with third parties or physically inspect assets. Rather, a review report expresses limited assurance in the form of the statement: “We are not aware of any material modifications” for the financial statements to be in conformity with the Generally Accepted Accounting Principles (GAAP). Reviewed financial statements must include all required footnotes and other disclosures.
Why might a business request a review engagement? It can be a good middle ground, providing the advantages of a Accountant’s technical expertise without the work and expense of an audit.
What we will do in Review engagement…
Compilation – Lowest Level of Assurance
In compiling financial statements for a client, we present information that is the “representation of management” and expresses no opinion or assurance on the statements. Compilations don’t require inquiries of management or analytical procedures. Instead, we rely on our knowledge of accounting principles and a general understanding of your business.
Banks often require compilations from an independent Accounting Firm as part of their lending covenants.
Financial Due Diligence
Due diligence is frequently made to obtain a specific information on a financial or business condition reflected in the financial statement or any other financial information. Our Financial due diligence frequently requested for the purpose of pre merger-acquisition, loan/credit approval, pre joint venture agreement, and investigation.
Agreed Upon Procedure
Agreed-upon procedures engagement is to carry out procedures of an audit nature to which auditor and auditee and any appropriate third parties have agreed and to report on factual findings. Some of our clients have requested our firm to perform agreed upon procedure for their special purpose. For many circumstances this assignment is considered more efficient and effective.
Internal auditing covers comprehensive services, such as designing internal audit organization, preparing internal audit working procedures, holding audit training for internal auditor, preparing modules of audit program and procedures, recruiting internal audit staff, and outsourcing internal audit.
Examination engagement is performed based on non-historical financial information, such as prospective financial statement or proforma financial statement.