A Notice to Reader is a compilation of the financial information produced by the company. Although there is no assurance provided by the accountant on the information contained in the statements, we ensure that the mathematical accuracy of the financial information is checked and that any matter that could be false or misleading is explained. A Notice to Reader does not include the accountant examining any of the underlying records or concluding on the fair presentation of the financial statement information. This is in part because a Notice to Reader financial statement is not required to follow Generally Accepted Accounting Principles; so the financial statements may be presented in a format useful to the specific users.

A Review is the next level up of a financial statement report. A Review provides negative assurance in the form of “nothing has come to the attention of the accountant that causes him/her to believe that the financial statements are not presented fairly in all material respects.” The work required of the accountant consists of inquiry, analytical procedures and discussion with management that support their negative assurance disclosure. Reviewed financial statements must comply with Generally Accepted Accounting Principles (GAAP) and therefore are held to more strict presentation guidelines. A Review involves significantly more work and documentation by the accountant to support a higher level of confidence in the financial statement than that in a Notice to Reader. This additional work is also reflected in the additional costs of a Review over a Notice to Reader. A Review may be requested by a company’s financing institution as these statements are intended to provide a standard and uniform presentation for the financial institution to use as a base in calculating bank covenants and other financial indicators. Another time a higher level assurance financial statement may be required is if you are considering selling all or part of your company. Potential buyers will want to see review financial statements for increased assurance they are getting what they are paying for.