Financial Statements
I can prepare the Financial Statements you need to run your business or to satisfy an outside partys request.
Financial statements are used to effectively manage a business, disclose the financial condition to third parties and to meet the reporting requirements of tax authorities. Financial statements generally consist of three statements that show income earned for a period; state the balance of assets, liabilities and owners equity as of a date; and show the changes in assets, liabilities and owners equity for a period. They may include notes that disclose pertinent information. An adequate system for recording financial transactions must be in place for any financial statement to be prepared. I can assist you in establishing a system that will allow you to produce a financial statement yourself for management purposes. The majority of financial transactions are routine, for the exceptions I can propose the correct treatment. Financial statements prepared by a CPA, must follow reporting requirements established by the Financial Accounting Standards Board (FASB). A CPA prepared financial statement must include a report or opinion from the CPA. The levels of assurance for the user of the financial statement are compilation, review or audit. The preparation of financial statements by a CPA is considered attest work. Not all CPAs licensed in California may do attest work. I am licensed to do attest work and may prepare financial statements. The preparation of any compilation, review or audit financial statement by a CPA is not intended to detect fraud or other wrong doing.
Compilation financial statements provide the least amount of assurances to the user. The format of the financial statements is correct but no significant work has been done to check the numbers. If a CPA is too involved in the recording of transactions or in the management of the business, he must report that he is not independent.
Review financial statements provide more assurances to the user than a compilation. The format of the financial statements is correct and limited work has been performed to check the numbers. Analytical procedures have been performed to test the reasonableness of the financial statements. A CPA must be independent to issue a review financial statement.
Audit financial statements provide the highest level of assurances to the user of financial statements. I do not prepare audit financial statements.