Compilation and review services

Privately held companies often ask CPAs to perform compilation or review services instead of an audit. During a compilation, the CPA becomes familiar with the nature of a client's transactions, then compiles the company's financial data into a financial statement format. The CPA does not express any opinion on their conformity with generally accepted accounting principles.

A review does provide a limited degree of assurance that the business' financial statements are in conformity with generally accepted accounting principles. During a review, the CPA makes inquiries into such matters as accounting principles and methods, record-keeping practices, and actions of the board of directors.