The objective of a review
engagement is to review financial statements to determine whether the
statements are reasonable and worthy of belief. Where an audit is not required
or the shareholders have waived the appointment of an auditor, financial
statements may be prepared on a review basis. This degree of assurance is less
than that resulting from an audit and is expressed as negative assurance that
nothing has come to the accountant’s attention that would indicate the
financial information is not presented in accordance with Canadian generally
accepted accounting principles.
In performing a review,
the Certified General Accountant would acquire sufficient knowledge of the
client’s business to make informed enquiries and assessment of the information
obtained. The review would include enquiries concerning all relevant
information, comparisons of financial data for the current and prior periods
and discussion governing the information received. In addition, the financial
statements are critiqued with the responsible and appropriate level of
management.
If, after reviewing the
financial statements, the accountant is satisfied that the financial
statements are in accordance with Canadian generally accepted accounting
principles, a review engagement report would be attached to the financial
statements.