(duplicate of post from Attestation Update blog)
Update – SSARS 19 had been replaced by SSARS 21. All the reports have been revised. You can check out these posts at my other blog, Attestation Update:
- Flash update on SSARS #21
- Newly approved SSARS will allow a new service, ‘preparation’. Will also require written & signed engagement letters.
- Sample compilation report under SSARS 21
- Sample accountant’s review report for SSARS 21
- Video overview of SSARS 21
- New risk alerts for 2014/2015 are available
Omission of cash flow statement under SSARS No. 19– Compilation reports will change for organizations with fiscal years ending after December 15, 2010. Here is the modified report I will be using after the first of the year for my non-profit clients if any would choose to omit the statement of cash flow. I doubt that will happen in my client base, but wanted to make this example available to the CPA community.
Please feel free to copy, but make sure you modify this based on your firm’s policies!
Single year report for omission of statement of cash flows:
Accountant’s Compilation Report
Board of Directors
Dear Board of Directors: (see reason for change on 11-19-11 at this post)
I have compiled the accompanying statement of financial position of Orgname as of December 31, 2010, and the related statement of activity for the year then ended. I have not audited or reviewed the accompanying financial statements and, accordingly, do not express an opinion or provide any assurance about whether the financial statements are in accordance with U.S. generally accepted accounting principles.
Management is responsible for the preparation and fair presentation of the financial statements in accordance with U.S. generally accepted accounting principles and for designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of the financial statements.
My responsibility is to conduct the compilation in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants. The objective of a compilation is to assist management in presenting financial information in the form of financial statements without undertaking to obtain or provide any assurance that there are no material modifications that should be made to the financial statements. During my compilation, I did become aware of a departure from U.S. generally accepted accounting principles that is described in the following paragraph.
A statement of cash flows for the year ended December 31, 2010, has not been presented. U.S. generally accepted accounting principles require that such a statement be presented when financial statements purport to present financial position and results of operations.
- Above example has been modified for a nonprofit organization.
- Note the reference to cash flow statement is removed from the first paragraph, the third paragraph is expanded, and a fourth paragraph is added.
- Change the singular pronouns (I) to plural pronouns (We) if you are a multi-partner firm. Update – change accountant’s to accountants’
- Original text contains “accounting principles generally accepted in the United States of America” instead of “U.S. generally accepted accounting principles”. The SASs allow the use of the format US GAAP. I believe that phrasing makes much more sense for my client base, so have changed the text to the GAAP format. Your firm policy may be different, so revised it (in four different places!) as needed.
- Text that will change for each client is input with intentional misspelling (see orgname, citystate, monthday), so if you forget to change the data, a spell check will remind you.
Update: I have written a 3-hour online CPE course called Compilation and Review: Practice Issues (Third Edition) available at the CCH Learning Center website. From the course description:
This course was prepared to enable participants who are experienced accountants to improve their knowledge of the issues affecting their compilation and review practices.
Course discussed in more detail at this post. If you like the writing you see on this website, check out the Practice Issue course.
2 thoughts on “SSARS 19 – Sample compilation report for omitting the statement of cash flow”
As a single practioner, the heading should be:
Accountant’s Compilation Report, not
Accountants’ Compilation Report.
Thanks for the new updated Report.
Thanks for pointing that out. Above sample changed. Will review and correct the other samples as well.
P.S. Corrected a few pages here and my other blog.