In a compilation engagement, management is primarily responsible for presenting the financial statements in conformity with generally accepted accounting principles. The CPA provides no assurance that the financial statements are presented in accordance with generally accepted accounting principles. The CPA obtains knowledge of the accounting principles and practices of the industry and a general understanding of the client’s business. The accountant does not have to obtain an understanding of the client’s internal control structure or assess control risk. Inquiries of management are not required unless additional information would clarify financial information. Substantially all generally accepted accounting principles may be omitted without restriction on use with a disclosure in a modified compilation report.
Copyright © 2022 Glenna Pound CPA. License Number 092-0000620