Level of Assurance:
A compilation engagement provides no assurance
For this type of report, the Chartered Professional Accountant will compile the financial statements on behalf of management from information provided by the client. It is not necessary to adhere to Canadian generally accepted accounting principles.
Sometimes estimated financial information is all the client needs (eg. estimated retail inventories for monthly management statements). Sometimes even incomplete information will suffice (eg. some accrued expenses may be overlooked for monthly management statements). Owners, management, and any third party users agree there's no need for a review
engagement to determine plausibility, or an audit
examination to ensure fairness.
The responsibility of the Chartered Professional Accountant for a compilation engagement is to "compile" financial statements from information provided by management. No attempt is made to test accuracy or completeness of the information provided, or to determine whether there are departures from Canadian generally accepted accounting principles. No expression of assurance is contemplated in a compilation engagement.