Audited Financial Statements

If we understand what financial statements are based on the course offered on this web site then one might wonder how do we know that the information presented is correct. The answer to that question is one of the most essential services that a CPA ( Certified Public Accountant ) provides to business and government. When a CPA prepares an audited financial statement they are assuring the reader that the financial statements have been subjected to several stages of planning, testing and procedures and that the audited financial statements are correct.

The ultimate goal of audited financial statements is to issue and unqualified opinion. An unqualified opinion gives the assurance that it is not necessary to qualify the audit opinon. If the auditors report must be "qualified" it means there is an issue that does not allow the CPA to totally give confidence that the audited financial statements are correct.

Below is the standard auditors report if there are not issues with the entities audited financial statements. Does this guarantee that there are no errors or fraud or errors in the audited financial statements? No. By reading the highlighted text one can understand why there is no guarantee that the financial statements are error free or free or fraud. The word material in laymans terms can be loosely translated as significant. Also a reasonable basis does not include protection from fraud conducted by the company or it's officers.

Board of Directors, Stockholders, Owners, and/or Management of
ABC Company, Inc.
123 Main St.
Anytown, Any Country

We have audited the accompanying balance sheet of ABC Company, Inc. (the “Company”) as of December 31, 20XX and the related statements of income and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in (the country where the report is issued). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 20XX, and the results of its operations and its cash flows for the year then ended in accordance with accounting principles generally accepted in (the country where the report is issued).

AUDITOR’S SIGNATURE
Auditor’s name and address

Date of the report’s issuance

Do you Need Audited Financial Statements?

As a CPA I can prepare audited financial statements for you or your company.If you have any other questions you can reach me via email, toll free number, skype chat or skype phone. There is no charge for our conversation so if you are not sure please give me a call at 866.559.6434

Warmest regards,

  Neil D. Rischall CPA