Audits, Reviews, and Compilations
Many business owners contact LCW CPAs for our assurance services including audits, reviews, and compilations. Assurance work is the work we do to issue an opinion regarding your business and its financials. The work is completed in response to a third party asking for an independent opinion.
It can be confusing and a bit unnerving to hear the words ‘audit’ or ‘review’. Rest assured, at LCW CPAs we will help you through the process. We will first determine what level of work is required, whether an audit, review, or compilation, based on the reviewing request and how the information will be used.
As a high-level overview, audits are the highest level of assurance provided; followed by reviews, with compilations providing the least level of assurance. At the risk of getting caught up in our professional terminology, we will help you understand the request to prepare and provide the level of assurance needed by you or a third party.
If the assurance work is required by a bank, the size of the loan may determine the level of assurance that the bank wants. For larger loans, as an example, they will want an audit or at least a review. For smaller loans, a review or compilation might be sufficient.
We have the expertise and experience to help with whatever assurance services you need to meet your goals, whether for audit services, financial reviews, or compilations so that the appropriate level of work is completed, and time and money are not wasted.
Do any of these situations sound familiar?
- Are you in need of audited financial statements for your business to procure or maintain a loan or bond?
- Does your entity have compliance work such as government or private grants or contracts that require reviewed or audited financial statements, or another compliance procedure be performed by a CPA?
- Did you just read your organization’s bylaws and determine that your not-for-profit requires an annual audit?
- Do you suspect fraud or feel that that something is not right with your books or cash flow?
If YES is your answer to any of these statements, you likely need assurance work in the form of an audit, review, or compilation.
Most of us hear the word “audit” and we immediately think of an IRS audit. If the IRS has contacted you, we can assist you with that matter, but that is not this kind of audit. Please learn more our tax services, including IRS audits.
An assurance audit is the most complete of the assurance services provided by a CPA firm. It is a comprehensive effort and provides the highest level of assurance of the three assurance services.
When certified public accountants talk about assurance audits, we are describing the work to audit your financial statements.
If the request has been to provide audited financial statements, LCW CPAs will complete the following audit services:
- review the strength of your internal accounting controls
- review the integrity of your accounting transactions
- review the accuracy of your account balances
- perform an overall business review including current and future contracts and risks to the company that might impact your business continuity
For small businesses, our team will work with your management team and often your bookkeeper. For larger companies, our audit team will work with your internal audit team and management team to collect the information needed.
The result is LCW CPAs issues an opinion, asserting that your financial statements are ‘free from material misstatement’ if everything is in order. A report is completed attesting to completion of the above work.
A financial review is a limited examination of your financial statements performed by a certified public accountant that includes an assessment of management and analytical procedures. It is a more limited scope than an audit and provides less assurance than an audit, but more assurance than a compilation.
There are two additional assurance-related services that LCW CPAs provides for our business clients.
- Preparation. While technically not an assurance service, CPAs may be engaged to prepare management use only financial statements, which may or may not be in conformity with accounting standards.
- Agreed-upon procedures. An engagement with agreed-upon procedures is a specific engagement where one aspect of the business is reviewed in accordance with a specific goal or compliance need. A common example during the pandemic was to have a CPA review your PPP Loan Forgiveness application before it was submitted. This type of review would be an agreed-upon procedure assurance engagement.
Benefits of LCW CPAs for Audit, Review, and Compilation Services
In addition to completing the requested assurance work, there are additional potential benefits for your business of engaging LCW CPAs for assurance work including the following:
- Ideas provided to improve and strengthen internal controls.
- Objective insight received regarding your business.
- Areas identified to boost profitability including lowering costs.
- Recommendations for additional operational efficiencies identified.
- Identification of procedures followed and those not being followed.
- Identification of opportunities to improve inter-department communication and workflow.
- Identification of business and management risks to expand the planning horizon or the company’s preparedness.
We provide accounting services, tax planning and preparation, audits, reviews, and compilations for individuals and businesses. Our clients are throughout most of eastern Massachusetts, the Merrimack Valley, south down to Woburn, west to Route 495 and east out to the seacoast. In New Hampshire, our clients are throughout Southern New Hampshire including Salem, Nashua, and Manchester, north up to Concord, and east over to the seacoast of New Hampshire.
As a progressive accounting firm, embracing technology to serve our clients effectively and efficiently is a priority to us. We offer consulting services and managed accounting services, including outsourced CFO and bookkeeping services, to businesses throughout the United States.
Why LCW CPAs
We offer many reasons why you should contact us to be your chosen CPA firm.
- We are local. As a local CPA firm, we offer the opportunity to build a working relationship where we get to know you and you get to know us. Maybe this sounds old-fashioned, but to us, it is the best way to work.
- We are progressive. We embrace improving and striving for better ways to help our clients. We utilize technology as an enabler to be more efficient and effective.
- We speak your language. Literally. We have many accountants fluent in multiple languages to best serve our diverse client base.
- We have a long-term view. We look to build relationships over time and seek to work with clients who value the benefits of a productive working relationship. If you are looking to secure a partner in the truest sense of the word, then we may be a great fit.
- We are experienced, credentialed, and knowledgeable. As CPAs, we offer expertise and knowledge to provide thoughtful guidance and advice.
- We offer a superior client experience where in every interaction you will experience our diligence, empathy, responsiveness, and the attention that you deserve. You can count on us to go above and beyond to do the right thing.
- We work with commitment and passion; we believe it is important to be good corporate citizens who are actively engaged in the community; we are deeply committed to the City of Lawrence and committed to helping our clients achieve their own American Dream.
Great firm. Tony and his team are always responsive, detailed and provide expert level service.
– Brian M.
Do not worry!
It is not necessary for you to know what assurance level is needed before contacting us for assistance. Many people assume they need an audit when a review or compilation is sufficient. We are here to help you assess what is necessary and prepare the proper level of assurance for your peace of mind and to meet the request of the third party.