Employee benefit statement template, All businesses, whether private, public, or non-profit, have to prepare financial statements on their own performance to give financial accountability and accuracy for their stakeholders and individuals with an interest in the business. These statements allow management to make business decisions, so enable creditors to evaluate loan programs, and provide people with information to make investment decisions.
Financial statements provide information from a company’s accounting documents about their economic assets and obligations on a particular date, as well as their financial activities over a time period. These statements are often prepared in accordance with Generally Accepted Accounting Principles (GAAP), that would be the criteria issued by the American Institute of Certified Public Accountants (AICPA), but they could also be prepared on other comprehensive basis of accounting, such as money basis or tax basis, based on the needs of their users.
Compiled financial statements provide lowest level of confidence. One of the chief reasons that these are used instead of different statements is to the timely release of financial information about a company. Compiled statements really are a demonstration of different financial reports and documentation, which is the representation of owners or management of a company. Compilation standards enable the organization to omit notice disclosures as long as there is no intent to mislead the users. This is the only kind of financial statement that lets omitted disclosures.
An unqualified belief in a financial statement indicates that the CPA is in agreement with the methods used by the enterprise to prepare their financial documents. The audit is found to be accurate, complete and fairly presented to meet the requirements of this US GAAP (Generally Accepted Accounting Principles). The audit provides that the CPA a reasonable basis for their opinion the financial statements are free from material misstatements or false/missing information. A professional opinion suggests that the CPA is not in agreement with characteristics of their financial statements or methods used to prepare their financial records. A skilled opinion suggests that the CPA is not confident that the financial statements are accurate or correct.
In composed financial statements, the organization, not the accountant, but is accountable for the accuracy and completeness of their financial records. Since the statements were not audited or examined, they aren’t accredited by a Certified Public Accountant (CPA). No opinion or assurance is expressed in the document regarding if the accumulated statements are free from material misstatements or false/missing info or if they are found to be true, complete and reasonably presented to fulfill the requirements of the US GAAP (Generally Accepted Accounting Principles).