Financial Reporting 101: Compilations, Reviews, and Audits Explained

how confident are you that your financial reports are reliable timely and relevant have they been prepared in accordance with generally accepted accounting principles commonly referred to as Gap what's appropriate for your company depends on the needs of your creditors investors and management team accountants offer three levels of assurance compilations reviews and audits compilations rely on data provided by management they provide no assurance that financial statements are free from material misstatement and conform with gap next I reviewed financial statements which provide limited assurance that the statements are free from Material misstatement here the CPA applies analytical procedures to identify unusual Trends in the financial statements in addition the CPA reviews your company's accounting policies the third option an audit provides a reasonable level of assurance that your financial statements are free for material misstatement audited financial statements are the only type of report to express an opinion about whether the financial statement are fairly presented and conform with gap not every business needs audited financial statements but the higher level of assurance you choose the more confidence you'll have that the financial statements fairly present your company's Performance contact SBA and we can help you determine which is the best option for your organization [Music]