A review is one step below an audit. In a review, the CPA examines a company’s financials to verify that they are free of deficiencies, but the firm does not review internal controls or fraud risks as in an audit.
A review is one step above a compilation. A compilation is simply a “compiling” of a company’s financials in a formal format, with an accountant’s letter accompanying the financials stating that the accountant performed the compilation. As opposed to audits or reviews, a compilation report does NOT give any assurances about the financials.
For more tax and accounting terms, check out the Glossary page on this website.