As part of an independent review or compilation agreement, the preparer of the financial statements is likely to capture journal entries in the software used.
These entries result in the ledger balances being different from what was sent to the preparer by the client.
When signed financials are available, it is important to ensure the entries are brought to account in the client ledgers.
Important because:
- The client will have accounting records which agree with the signed financial statements.
- Management accounts that are prepared will be more accurate because of the amendments to the opening balances.
- Management are better equipped to make important strategic decisions based on the figures presented.
- Less work for the preparer of the financial statements as they will not be required to evaluate what was brought to account and what was not.
- Ultimate cost saving.
Please speak to your Key Relationship Manager at Northbound during the sign off process should there be uncertainties regarding the entries in question or should it not be distributed to you as client.
By Cornel Gouws
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