We provide four levels of attestation services. And once the level of service is determined, there are multiple types of reporting to consider (GAAP and other comprehensive basis of accounting). Over the years, WGC has assisted many of our clients with determining the level of service necessary, as well as the appropriate reporting methodology.
An audit represents the highest level of attestation that an independent accountant can express. The purpose of an audit is to provide a report that is attached to the financial statement, and lets the reader of the statements know that they are materially correct and comply with the elected reported methodology. In order to issue the report, the auditor must use guidelines stipulated by General Accepted Audit Standards (GAAS), as determined by the American Institute of Certified Public Accountants (AICPA). These include reviewing corroborative data as well as a detailed study of the system and procedures the entity uses to prepare its financial statements.
A review represents the next-highest level of attestation that an independent accountant can issue. The purpose of a review is to provide limited assurance that the financial statement is free of material errors and complies with the reporting methodology elected. In order to issue a review, the independent accountant must perform the procedures prescribed by the AICPA as defined by the Statements on Standards for Accounting and Review Services (SSARS). These procedures are limited to inquiry of management and key company personnel, as well as performing analytical procedures.
A compilation is the lowest form of attestation that an independent accountant can issue. It consists of presenting information such as management's representations in the form of financial statements, without expressing assurance on them. Accountants aren't required to make inquiries or perform other procedures to corroborate or review the information supplied by management.
This type of engagement is one in which independent accountants are engaged to report their findings based upon specific agreed-upon procedures performed. Some examples of agreed-upon procedures include study of internal controls and accuracy of accounts receivable.