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SAS
No. 35 Engagements
to Compile Financial Information |
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Issued by Auditing Standards Committee in Taiwan on 28 November,
2000. |
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Summary |
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The objective of a compilation engagement is for the accountant to
use accounting expertise, as opposed to auditing expertise, to
collect, classify and summarize financial information. The
procedures employed are not designed and do not enable the
accountant to express any assurance on the financial information. A
compilation engagement would ordinarily include the preparation of
financial statements (which may or may not be a complete set of
financial statements) but may also include the collection,
classification and summarization of other financial information. |
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In all circumstances when an accountant’s name is associated with
financial information compiled by the accountant, the accountant
should issue a report. |
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Independence is not a requirement for a compilation engagement.
However, where the accountant is not independent, a statement to
that effect would be made in the accountant’s report. |
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The accountant should ensure that there is a clear understanding
between the client and the accountant regarding the terms of the
engagement. |
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The accountant should plan the work so that an effective engagement
will be performed. |
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The accountant should document matters which are important in
providing evidence that the engagement was carried out in accordance
with this Statement and the terms of the engagement. |
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The accountant should obtain a general knowledge of the business and
operations of the entity and should be familiar with the accounting
principles and practices of the industry in which the entity
operates and with the form and content of the financial information
that is appropriate in the circumstances. To compile financial
information, the accountant requires a general understanding of the
nature of the entity’s business transactions, the form of its
accounting records and the accounting basis on which the financial
information is to be presented. The accountant ordinarily obtains
knowledge of these matters through experience with the entity or
inquiry of the entity’s personnel. |
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If the accountant becomes aware that information supplied by
management is incorrect, incomplete, or otherwise unsatisfactory,
the accountant should consider performing the following procedures
and request management to provide additional information:
(a) Make any inquiries of management to assess the reliability and
completeness of the information provided;
(b) Assess internal controls;
(c) Verify any matters or verify any explanations.
If management refuses to provide additional information, the
accountant should withdraw from the engagement, informing the entity
of the reasons for the withdrawal. |
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The accountant should read the compiled information and consider
whether it appears to be appropriate in form and free from obvious
material misstatements. If the accountant becomes aware of material
misstatements, the accountant should try to agree appropriate
amendments with the entity. If such amendments are not made and the
financial information is considered to be misleading, the accountant
should withdraw from the engagement. |
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The accountant should obtain an acknowledgment from management of
its responsibility for the appropriate presentation of the financial
information and of its approval of the financial information. |
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The financial information compiled by the accountant should contain
a reference such as “Compiled without Audit or Review” on each page
of the financial information or on the front of the complete set of
financial statements. |
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 Effective
date
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This Statement is effective from 31 December, 2000. |
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