Compilation of financial statements under ISRS 4410
We prepare the financial statements from your accounting data, applying professional judgement to their form and to the completeness of disclosures, without verifying the figures. This is the service for situations where properly presented statements are needed rather than assurance on them: for a shareholder, a bank, a parent company, or simply to hold a set that stands up to being shown.
An ISRS 4410 compilation is the preparation of financial statements from client data with no assurance provided. The practitioner does not verify the data or express an opinion but is responsible for the form, the completeness of disclosures and for the statements not being obviously misleading. Faster and cheaper than an audit or a review.
Three different engagements and when each applies
Reasonable assurance
The auditor gathers evidence and expresses an opinion. Required where the law, a donor or the charter demands it. More: statutory audit.
Limited assurance
Inquiries and analytical procedures with a negatively worded conclusion. Fits where the donor or the bank does not require an audit. More: review of financial statements.
No assurance
Preparation of the statements from your data. The practitioner does not test the amounts but is responsible for presentation and disclosure. The fastest and least expensive option.
The key rule: a compilation does not replace an audit where the audit is required by law or specifically demanded by a donor. If you are unsure what is being asked of you, send us the requirement and we will tell you free of charge which format applies.
When a compilation is commissioned
The group asks for a package in its own format and in English. The data exists on your side; what is missing is a properly assembled set with notes.
The lender wants to see presentable statements but does not require an auditor’s report. A compilation closes the question in a few days.
The books are kept by a part-time specialist or by the owner, and there is nobody to assemble the annual statements. We prepare them and explain what they say.
The buyer asks to see three years of statements. We put them in order through a compilation first, and only then, if needed, an audit is commissioned.
Four steps
We receive the trial balances, supporting schedules and principal contracts, and agree the reporting framework: Ukrainian standards or IFRS.
Statement of financial position, income statement, cash flow and changes in equity, with a check that the statements agree internally.
Accounting policy, judgements, related parties and events after the reporting date. The notes are what separate professionally prepared statements from a set of tables.
The statements together with a compilation report stating plainly that no assurance is provided, in English and Ukrainian.
What a compilation does not do
The practitioner does not test source documents, does not confirm balances with counterparties, does not observe inventory counts and does not express an opinion on reliability. If during the work it becomes apparent that the data is incomplete or the statements are misleading, we must ask for corrections and, if none are made, withdraw from the engagement. In practice this is rare; questions are normally settled by clarifying the data. Where the books need rebuilding first, we do that: accounting restoration.
What clients ask most often
How does a compilation differ from an accountant simply preparing the statements?
Formally, it is performed under the international standard ISRS 4410 and accompanied by a practitioner’s report. Practically, the set is assembled by people who see every day how such statements are read by auditors, banks and parent companies.
Will a bank accept statements after a compilation?
If the bank does not require an auditor’s report, usually yes. Ask your relationship manager for the exact wording of the requirement and send it to us; we will say whether a compilation is sufficient.
How much does it cost?
Less than a review and materially less than an audit. We quote after reviewing the assignment, normally within one working day.
Can you audit the same statements afterwards?
No. An auditor cannot audit statements it prepared. If an audit becomes necessary, another firm performs it and we help prepare the documentation.
Do you prepare statements under IFRS?
Yes, under both Ukrainian standards and IFRS. More on IFRS: IFRS reporting services.
Request a proposal
Tell us the reporting year and who requires the statements. We reply within one working day.