It can be difficult to understand the difference between an audit and an assurance engagement. Both audits and assurances provide a level of comfort to stakeholders, but there is a big distinction between the two services. In this blog post, we will discuss the key differences between audits and assurances so that you can make an informed decision about which service is right for your business! When you need accounting, assurance, and tax solutions, you can always trust the experts at Quadri & Smith LLP. Reach out to us today to learn more!
Audit vs. Assurance - What's The Difference?
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Definitions
We'll start by defining audit and assurance so you have a better understanding of both terms. Audits are financial examinations of a company's financial statements. The goal of an audit is to express an opinion on the accuracy of those statements. Assurances, on the other hand, are reviews that provide limited assurance about specific aspects of a business or operation.
What Comes First?
An audit is always performed first, before an assurance. The reason for this is that auditors are required by law to express an opinion on a company's financial statements. Assurances, while still important, are not as critical as audits and do not carry the same weight.
Who Performs Them?
Audits are always performed by certified public accountants (CPAs). Assurances can be performed by CPAs, but they can also be performed by other professionals, such as management consultants.
Purpose
The purpose of an audit is to provide stakeholders with a level of comfort that the financial statements are accurate. The purpose of an assurance is to provide stakeholders with a level of comfort about specific aspects of a business or operation.
Audits and assurances are two very different services. Audits are financial examinations of a company's financial statements, while assurances are reviews that provide limited assurance about specific aspects of a business or operation. Always remember that audits come first, before assurances, and that they are performed by certified public accountants. If you need help understanding which service is right for your business, reach out to the experts at Quadri & Smith LLP! We provide accounting, assurance, and tax solutions to businesses in Ontario. Contact us today to learn more!