Statement on Standards for Accounting and Review Services
Issued by the Accounting and Review Services Committee
Institute of Certified Public Accountants
Reporting on Compiled Financial Statements
1. This statement amends the reporting standard1 set forth in paragraph 14 (a) of Statement on Standards for Accounting and Review Services 1 to read as follows:
A compilation has been performed in accordance with standards established by the American Institute of Certified Public Accountants.
2. This statement also amends paragraph 17 of SSARS 1 by changing the first sentence of the standard compilation report to conform to the amended
1. SSARS 1 provides guidance considered necessary to enable the accountant to comply with the general standards of the profession set forth in rule 201 of the AICPA Rules of Profes-sional Conduct in the context of a compilation or review engagement and establishes addi-tional standards deemed appropriate for such engagements. For example, SSARS 1 indicates that an accountant who is engaged to compile financial statements
• Should establish an understanding with the entity regarding the services to be performed and the report the accountant expects to render (par. 8).
• Should have or obtain knowledge of the accounting principles and practices of the entity's industry and a general understanding of certain matters related to the entity itself (pars. 10 and 11).
• Should consider whether it will be necessary to perform other accounting services, such as assistance in adjusting the books of account or consultation on accounting matters (par. 11).
• Should take certain actions when the accountant becomes aware that information supplied by the entity is incorrect, incomplete, or otherwise unsatisfactory (par. 12).
• Should read the compiled financial statements and consider whether they appear to be ap-propriate in form and free from obvious material error (par. 13).
• Should consider whether to modify his report if in his compilation of the financial statements he becomes aware of a departure from generally accepted accounting principles (or another comprehensive basis of accounting) that is material to the financial statements and the finan-cial statements are not revised (pars. 39-41).
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