Compiled Financial Statements
Compiled financial statements represent the most basic level of service CPAs provide with respect to financial statements. In a compilation engagement, the accountant assists management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements. The CPA issues a report stating the compilation was performed in accordance with Statements on Standards for Accounting and Review Services; and that the accountant has not audited or reviewed the financial statements and accordingly does not express an opinion or provide any assurance about whether the financial statements are in accordance with the applicable financial reporting framework. Generally appropriate for privately held companies and to be used by third parties such as banks, creditors etc., based on their requirements/ situations (e.g., lender needs the comfort provided by knowing that an accountant read the financial statements).