2. Compilation requirements

1. Knowledge: Accountants should possess adequate knowledge of the accounting principles and practices.

2. Reading: Before issuing a report, accountants should read the compiled financial statements and consider whether they are appropriate in form and free from obvious material errors.

3. Issues: If an accountant becomes aware that noncompliance with laws and regulations may have occurred, that there is a going concern uncertainty, or that a subsequent event has occurred, he or she should request management to consider the effect on the financial statements, evaluate management conclusions, and consider the effect of the matter on the compilation report.

4. Inaccuracies: If the accountant discovers the information is incorrect, incomplete, or unsatisfactory, they should obtain additional or revised information from the client. If the client refuses to provide such information, the accountants should withdraw from the compilation engagement.

5. Documentation: Engagement letter; a copy of the financial statements; a copy of the accountant's report.

3. Reporting on a compilation

The accountant's report in a compilation engagement should be in writing and:

• Include a statement that management is responsible for the financial statements.

• Identify the financial statements that have been subjected to the compilation engagement.

• Identify the entity for which financial statements have been subjected to the compilation engagement.

• Specify the date or period covered by the financial statements.

• Include a statement that the accountant performed the compilation engagement in accordance with SSARS promulgated by the Accounting and Review Services Committee of the AICPA.

• Include a statement that the accountant did not audit or review the financial statements nor was the accountant required to perform any procedures to verify the accuracy or completeness of the information provided by management, and, accordingly, does not express an opinion, a conclusion, nor provide any assurance on financial statements.Include the signature of the accountant or the accountant's firm.

• Include the city and state where the accountant practices (this may be indicated in the letterhead.

• Include the date of the report.