Chapter 4PERFORMING COMPILATION ENGAGEMENTS

LEARNING OBJECTIVES

After completing this chapter, you should be able to do the following:

    Identify the objective and framework of compilation engagements.

    Recognize the elements that comprise compilation engagements.

    Distinguish compilation engagements from preparation engagements.

    Identify the performance requirements for a compilation engagement.

    Recognize the documentation requirements for a compilation engagement.

Compilation Framework and Objectives

This section provides an overview of the objective and framework of compilation engagements and how they compare to other engagements such as preparation, review, or audit.

DEFINITION

The objective of the accountant in a compilation engagement is to apply accounting and financial reporting expertise to assist management in the presentation of financial statements and report in accordance with this section without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements in order for them to be in accordance with the applicable financial reporting framework. Because compiled financial statements provide the reader no assurance regarding the statements, they represent one of the lowest levels of financial statement services accountants can provide to their clients.

One of the most significant changes that affects compilation engagements that was brought about by the issuance ...

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