425 East Colorado Street Suite 535F Glendale CA 91205


We perform financial statement audits, reviews and compilation engagements.

Financial Statement Audits

We perform audits of financial statements under Generally Accepted Auditing Standards (GAAS) including general, field work, and reporting standards. An audit consists of planning, fieldwork (testing) and completion, including reporting phases.

As part of planning, the auditor must obtain a sufficient understanding of the entity and its environment, including its internal control regardless of whether the auditor plan to place any reliance on the internal controls. The auditor is also obligated to assess the risk of material misstatement of the financial statements. The assessed risk is used to design the nature, timing, and extent of audit procedures (AU Section 314, Understanding the Entity…and Assessing the Risks of Material Misstatement).

As part of fieldwork, the auditor must obtain sufficient appropriate audit evidence by performing audit procedures. Audit procedures include test of controls or substantive procedures, which, in turn, comprise detailed tests and substantive analytical procedures. Detailed tests include inspection, observation, confirmation, recalculation, reperformance performed in addition to inquiries (AU-C Section 500, Audit Evidence).

AICPA audit standards require the auditor to perform substantive procedures that are specifically responsive to risks the auditor has determined to be significant (AU-C Section 330, Performing Audit Procedures…). Note that management override of controls and related material misstatement due to fraud are considered significant on all audits (AU-C Section 240, Consideration of Fraud…). The auditor should also presume that risks of fraud exist in revenue recognition.

The auditor is required to use external confirmation procedures for accounts receivable unless the overall account balance is immaterial or other conditions are met (AU-C Section 505, External Confirmation).

It is ordinarily necessary for the independent auditor to be present at the time of inventory counts and perform necessary procedures during such counts providing sufficient and appropriate audit evidence in relation to inventory balances (AU Section 331, Inventories).

As part of audit completion, the auditor obtain management representation letter, performs final analytical procedures (AU-C Section 520, Analytical Procedures). These and other completion procedures are performed before issuing the audit report.


We perform review projects, according to AICPA’s AR-C 90, Review of Financial Statements.

Generally, reviews are limited to performing analytical procedures and inquires, as a basis for reporting whether the accountant is aware of any material modifications that should be made to the financial statements. The accountant’s conclusion is based on the accountant obtaining limited assurance. The accountant must be independent of the entity when performing a review of financial statements.


We perform compilation projects, according to AICPA’s AR-C 80, Compilation Engagements, which is part of SSARS No. 21.

The purpose of compilation engagement is to apply accounting and financial reporting expertise to assist management in the presentation of financial statements. As part of compilation, the accountant does not obtain or provide any assurance that there are no material modifications that should be made to the financial statements. Compilation engagements result in issuing a compilation report. A compilation engagement is separate from a preparation of financial statements engagement performed under AICPA’s AR-C 70. An accountant can be engaged to prepare financial statements and to perform a compilation engagement.

Compilation procedures include reading the financial statements, bringing to the attention of management information indicating incomplete or inaccurate documents, financial records or other issues with the financial statements, requesting additional or corrected information.