Auditing, attestation, and assurance are services that professional accountants provide that can help you with your personal and business finances. But what exactly are these services, and how can a Certified Public Accountant (CPA) help?
Let’s explore auditing, attestation, and assurance, including why you might need these services and why hiring a professional is crucial to successful processes.
Auditing Services for Businesses
Auditing is more than just crunching numbers. It’s about uncovering the truth behind those figures by obtaining unbiased evidence to reveal a company’s financial health and identify any risks or gaps in data.
Financial audits are done by a person or firm outside the company to provide a third-party overview and evaluation of evidence supporting financial statement accuracy and integrity.
While the idea of an audit can sound intimidating, they’re intended to provide invaluable insight so you can make the right decisions for impactful change and support company growth.
Understanding Attestation Services
Attestation services allows a professional to check the validity of financial statements through a review of the financial statements, or examinations of prospective financial statements. These services are smaller in scope than an audit as they use inquiries and analytics to test the reasonableness of the financial statements..
Attestations aren’t just about going through a checklist. Professional attestation services provide reasonable assurance against fraud or error in your financial reports when measured against a set rule, giving you confidence that your information is correct and strengthening your position for loans, mergers and acquisitions, and other business needs.
Assurance Services Explained
Where auditing involves gathering information and attestation involves comparing that information against a set of guidelines or systems, assurance simply looks at the validity of the data provided.
Anyone can compile financial statements, but it’s not always clear if these statements are accurate and credible. That’s where a CPA comes in.
A CPA will ensure the information is credible and correct, allowing businesses to pursue funding, make financial decisions, or adjust their spending. It also assures companies that the information other organizations provide is fair and accurate, such as when seeking funding or mergers and acquisitions.
Why Use a Professional for Auditing, Attestation, and Assurance Services?
Having a third-party organization handle your auditing, attestation, and assurance services is crucial. This isn’t just because CPAs are trained to perform these services meticulously. It’s because they provide an unbiased assessment that can increase your credibility.
Using professionals brings objectivity into the process of thoroughly assessing your financials. Their unbiased reports help identify errors or discrepancies in financial statements that could lead to significant business decisions based on incorrect information.
A CPA’s expertise allows them to get the job done accurately and proficiently and present their findings in a clear and organized way. It also allows companies to ensure everything adds up correctly while following generally accepted auditing standards. That’s how they give stakeholders reasonable assurance about the company’s financial health.
Non-Assurance vs. Assurance Services
Accounting involves two distinct services: non-assurance and assurance. What’s the difference, and why does it matter for your assurance process?
Exploring the Spectrum of Non-Assurance Services
In the world of finance, non-assurance or non-attest services are those that don’t involve independent verification. Think tax return preparation or financial statement creation–they involve compiling data rather than verifying it.
CPAs offer these services, which cover a broad range, from bookkeeping to advisory work. They play an integral role in keeping businesses running smoothly by handling routine tasks so business owners can focus on what they do best.
Diving Into Assurance Services
On the other hand, assurance services allow a CPA to include a report based on their interpretation of the data. These professionals provide this under attestation standards issued by the American Institute of Certified Public Accountants (AICPA).
The goal is to give stakeholders confidence in the company’s financial statements and internal controls over privacy measures through rigorous audit processes.
This builds trust among investors and regulators alike because such reviews provide reasonable assurance against material misstatement due to fraud or error, and they offer greater perspective and credibility than non-assurance services.
Contact Scharf Pera & Co., PLLC, for More Information
Scharf Pera & Co., PLLC provides auditing, attestation, and assurance services for businesses and individuals. Our professional team of CPAs brings a wealth of experience to all your assurance needs, so contact us today to learn more about processes, team, and how we can assist you.