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I
recognize that different business entities have different needs. Acknowledging
these differences, my practice provides the following range of financial
statement services.
Compilation
A compilation of financial statements is defined as presenting in
the form of financial statements information that is the representation
of management (owners) without undertaking to express any assurance
on the statements. A compilation is for companies that need help
in preparing their financial statements. It is useful when there
are limited in-house capabilities for preparing financial statements.
It is also useful when management wants an independent preparation
of its financial statements. My service includes not only financial
statement preparation, but revenue, overhead, and profit opportunity
analysis also.
Independent Review of Company-Prepared Financials
For companies who prepare their own financial statements internally,
it is often a good idea to have them independantly reviewed by a
CPA. This review can be conducted on a monthly, quarterly, semi-annual,
or annual basis. Business owners must make sure they are receiving
accurate, reliable financial information from their internal accounting
staff.
Financial Forecasts and Projections
A business organization might want or need to prepare a financial
forecast for many reasons: [a] to budget income and expenses for
the upcoming year, [b] for general business planning purposes, [c]
to aid in the valuation of the entity, or [d] to fulfill a lender's
requirement for granting a loan. The difference between a forecast
and a projection is that in a forecast, all the assumptions are
expected to occur, whereas in a projection at least one assumption
is not necessarily expected to occur and may be improbable. In other
words, a forecast presents management’s expectations; a projection
presents management’s expectations based on a ‘what
if’ situation. Note, however, that the other assumptions in
a projection are expected to occur if the hypothetical assumption
occurs.
Personal Financial Statements
There may be a time when an individual needs to have prepared a
personal financial statement. Personal financial statements are
sometimes needed when obtaining a bank loan, for tax or estate planning,
or during the preparation of a personal financial plan.
For more information about my practice’s Accounting services,
call Reed Tinsley at 281-379-5988 or email reedt@rtacpa.com.
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