Audits, Reviews and Compilations   Third parties who rely on your financial statements often require an audit, review or compilation be performed for assurance that financial statements present a true and accurate picture of a company.  Each provide a different level of assurance based on the risk tolerance of the users.   Audit   The highest level of assurance is provided by an audit. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements and includes tests of documentary evidence supporting the transactions recorded in the accounts, and may include tests of the physical existence of inventories, and direct confirmation of receivables and certain other assets and liabilities by correspondence with selected individuals, creditors, and financial institutions.  An audit also includes a review of internal controls.    An Audit facilitates the following:   Satisfies not only the stockholders as to the reliability of the financial statements but also managers, customers, suppliers and creditors. Ensures payments of corporate tax, sales tax, and other taxes on-time and accurately which in turn assists in the avoidance of interest, penalties, and investigations. Needed for compliance with certain loan covenants and regulatory requirements. Helps detect and/or prevent material fraud and error. Purchase and/or sales of a business. Provides detailed insights into the operations of your business and your financial position. Independent examination of your system of internal control.   Hilliard & Milton, LLC employs a risk based audit approach which is superior to traditional audit approaches in two areas. Focus is on risk – Risks associated with a financial statement audit are the underlying causes of financial surprises.  Identification of these risks during the planning phase of the audit rather than only looking at the accounting records provides a better product for you the client. Value added approach – Adding value to the audit product is done keeping you in mind.  Examining and inspection of the quality of the financial information and reporting process adds value to management.  The risk based audit is a practical approach to the audit process and addresses the requirements of authoritative literature.  An audit strategy is then designed to assist us in meeting those requirements. Our audit approach is flexible and adaptable, allowing us to better leverage our knowledge of you, the client, to tailor our audit procedures.   In summary, the risk based audit focuses on both recorded and unrecorded risks and improves financial statement assurance and the financial statement reporting process.  When risks are identified in a particular area the risk based audit focuses more audit time in that area.  In addition, more client controls may be required in those areas.   Review                                                    Back To Top   Reviews are less extensive than an audit and provide an intermediate level of assurance.  Reviews consist of primarily analytical procedures applied to the financial statements.  A review also consists of various inquiries of management.  Additional procedures are performed in those areas where inadequate supporting information is available or the data obtained appears inconsistent with the related disclosures.  Reviewed financial statements must include all required footnotes and other disclosures but do not require a review of internal controls.   In many instances users of the financial statements require a review in order to have the advantage of a CPA review the financial information without the more extensive work and thereby expense of an audit.     Compilation                                            Back To Top   Compilations provide the lowest level of assurance.  Compiled financial statements present information in the form of financial statements that are the "representations of management".  No opinion is expressed on complied financial statements.  CPAs rely only on their knowledge of accounting principles and their general understanding of the business to present the obtained information in the form of financial statements.  Compilations may be completed monthly, quarterly, or annually, and may include comparisons with prior periods.   Regardless of the level of assurance needed, rest assured we will provide quality service in a timely manner.  Through our commitment to excellence, we wish to provide effective, cost efficient services to you throughout our relationship.