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compiled and reviewed financials for year end businesses

PostPosted: 25-Apr-2019 7:23am
by wwwcpa1biz
Pros,

I am curious what you do here. We have clients who need compiled and reviewed financials done for third parties such as bankers. They are calendar year end companies. The clients usually dont get the books closed until end of January or Mid February for previous year end. By then, we are getting deep into the tax season. Do you tell these clients we need to extend, and get it done after 4/15, or get it done during the tax season? Thank you.

Re: compiled and reviewed financials for year end businesses

PostPosted: 25-Apr-2019 8:11am
by BerkshireCPA
Most clients in that situation we would get the corporate tax returns by the March 15 deadline(assuming S Corp or partnership)and start working on the financial statements at the end of April and into May. Since most CPA's firms are in the same boat, I do not think it should be too much of an issue.

One thing I have noticed is that every C corporation we have is now put on extension with the new April 15 deadline. It has just worked out that way. But 95% of our corporations are S Corps so we are only talking about a handful of C Corps

Re: compiled and reviewed financials for year end businesses

PostPosted: 25-Apr-2019 8:19am
by wwwcpa1biz
Thank you Berkshire. The issue we have here is we do the compiled or review first, and then do the tax return so these two match up. Do you do it the other way?

Re: compiled and reviewed financials for year end businesses

PostPosted: 25-Apr-2019 8:35am
by sjrcpa
We get very few comp, review and audit engagements completed during tax season. Therefore the business' tax returns are extended.

Re: compiled and reviewed financials for year end businesses

PostPosted: 25-Apr-2019 9:49am
by CornerstoneCPA
I no longer do compilations and have never done reviews/audits--prepared financials only--but I would extend and compile/review the financial statements, first. Otherwise, you are potentially looking at unnecessarily amending a return.

Even for prepared financial statement engagements, I will not prepare the return until the financials are complete. Accordingly, the returns are extended.

Re: compiled and reviewed financials for year end businesses

PostPosted: 26-Apr-2019 3:04am
by wwwcpa1biz
Thank you pros. While we are speaking about this. How long in hours does it take you on average to prepare a compilation with notes and a review with notes?

Re: compiled and reviewed financials for year end businesses

PostPosted: 17-May-2019 3:04pm
by Doug M
A word of caution. Doing a compilation with footnotes puts you, as a preparer, at a lot of risk. If you are doing footnotes, add the analytical review and prepare a reviewed financial statements.

Re: compiled and reviewed financials for year end businesses

PostPosted: 28-May-2019 9:13am
by novacpa
wwwcpa1biz wrote:Thank you pros. While we are speaking about this. How long in hours does it take you on average to prepare a compilation with notes and a review with notes?


If you have an Office in Virginia and have a Virginia CPA License - you also need a "firm license" (peer reviewed) to
issue assurance opinions on Compiled or Reviewed Financial Statements, do you have that?
I do know if having a DC CPA license requires a "peer review".

Re: compiled and reviewed financials for year end businesses

PostPosted: 11-Jun-2019 12:59pm
by CornerstoneCPA
Most states I have looked at have the firm registration/license and peer review requirements under this scenario. SC certainly does.

Re: compiled and reviewed financials for year end businesses

PostPosted: 2-Jul-2019 1:48pm
by dsocpa
Maryland requires all CPA's doing attest functions to be peer reviewed. If you are part of a company with non-cpa's - like myself - I do attest work under my license only. I am peer reviewed every 3 years as a solo practitioner.

Re: compiled and reviewed financials for year end businesses

PostPosted: 5-Jul-2019 8:49am
by novacpa
dsocpa wrote:Maryland requires all CPA's doing attest functions to be peer reviewed. If you are part of a company with non-cpa's - like myself - I do attest work under my license only. I am peer reviewed every 3 years as a solo practitioner.


May I ask what "fee" you pay for your peer review?

I'm not sure if DC licensed CPAs also have a "peer review" requirement. If they don't can they issue opinions on financial statements of Companies in Maryland & Virginia?

Re: compiled and reviewed financials for year end businesses

PostPosted: 5-Jul-2019 4:56pm
by dsocpa
It varies. The administrative fee I pay to MACPA is ~$150. The fees I've paid to have the peer review range from$1000 to $850. I've been told due to all the changes the process will be over $2k this year. Time to up the fees for reviews!

Re: compiled and reviewed financials for year end businesses

PostPosted: 9-Jul-2019 1:47pm
by CornerstoneCPA
novacpa wrote:May I ask what "fee" you pay for your peer review?



The last peer review I had to do, which was for a single compilation, cost me over $500. Just another reason I stopped doing any work that fell under peer review.

Re: compiled and reviewed financials for year end businesses

PostPosted: 15-Aug-2019 10:01am
by basisschedule
wwwcpa1biz wrote:Thank you Berkshire. The issue we have here is we do the compiled or review first, and then do the tax return so these two match up. Do you do it the other way?


Both should be done concurrently. If you find adjustments in a review after taxes have been filed then it will be fun explaining the tax failure to the client. Even worse it could be motivation for staff to conceal the errors to avoid such embarrassment.

These engagements should be done in Jan/Feb or extended to after busy season. A deadline should be given to the client if they want their engagement completed early. Some may have deadlines with bankers/regulators/etc.