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Terms of Service Reviewed Financial Statements

Terms of Service – Reviewed Financial Statements 

 

The entity name above shall be referred to herein as “THE CLIENT”.

This letter is to confirm our understanding of the terms and objectives of our engagement and the nature and limitations of the services we will provide. Engagement letters as recommended “Best Practices” by the Florida Board of Accountancy, which you can refer to by visiting the Florida’s Website. Execution of this engagement letter confirms your understanding of the terms and objectives of the engagement, nature and limitations of the services we will provide.

We will review the balance sheet of the above referenced entity herein after referred to as the “THE CLIENT” as of December 31, 20XX, and the related statements of operations, retained earnings (deficit), and cash flows for the year then ended, in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants.  Our review will consist primarily of inquiries of company personnel and analytical procedures applied to financial data.  At the conclusion of our review, we will require certain written representations from you about the financial statements and related matters.  Those written representations are a material part of the review we will perform, and your failure or refusal to provide them in a timely manner will constitute a scope limitation that may preclude us from completing the engagement and issuing our report.

A review does not contemplate obtaining an understanding of the internal control or assessing control risk, tests of accounting records and responses to inquiries by obtaining corroborating evidential matter, and certain other procedures ordinarily performed during an audit.  Thus, a review does not provide assurance that we will become aware of all significant matters that would be disclosed in an audit.

Our engagement cannot be relied upon to disclose errors, fraud, or illegal acts that may exist.  However, we will inform you of any material errors or any fraud or illegal acts that come to our attention, unless they are clearly inconsequential.  In addition, as part of this engagement we have no responsibility to identify and communicate significant deficiencies or material weaknesses in your internal control, and our engagement cannot be relied upon to disclose the same.

Our report on the annual financial statements of “THE CLIENT” is presently expected to read as follows:

We have reviewed the accompanying balance sheet of “THE CLIENT” as of [dates aforementioned above], and the related statements of income, retained earnings, and cash flows for the year or period then ended.  A review includes primarily applying analytical procedures to management’s financial data and making inquiries of company management.  A review is substantially less in scope than an audit, the objective of which is the expression of an opinion regarding the financial statements as a whole.  Accordingly, we do not express such an opinion.

Management is responsible for the preparation and fair presentation of the financial statements in accordance with accounting principles generally accepted in the United States of America and for designing, implementing, and maintaining internal control relevant to the preparation and fair presentation of the financial statements.

Our responsibility is to conduct the review in accordance with Statements on Standards for Accounting and Review Services issued by the American Institute of Certified Public Accountants.  Those standards require us to perform procedures to obtain limited assurance that there are no material modifications that should be made to the financial statements.  We believe that the results of our procedures provide a reasonable basis for our report.

Based on our review, we are not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformity with accounting principles generally accepted in the United States of America.

If for any reason we are unable to complete the review of your financial statements we will not issue a report on such statements as a result of this engagement.

The distribution of our report is restricted to the internal use of the management of your company, and, accordingly, will not be distributed to outside parties to obtain credit or for any other purpose without our prior express written consent.  Our compilation engagement will not be planned or conducted in contemplation of reliance by any other party or with respect to any specific transaction and is not intended to benefit or influence any other party.  Therefore, items of possible interest to a third party may not be specifically addressed or matters may exist that could be assessed differently by a third party.

The distribution of our report is restricted to the internal use of the management of your company, and, accordingly, will not be distributed to outside parties to obtain credit or for any other purpose without our prior express written consent.

Our review services and report are intended for the benefit and use of “THE CLIENT”. The review engagement will not be planned or conducted in contemplation of reliance by any other party or with respect to any specific transaction and is not intended to benefit or influence any other party.  Therefore, items of possible interest to a third party may not be specifically addressed or matters may exist that could be assessed differently by a third party.

Gustavo A Viera, CPA is the engagement partner and is responsible for supervising the engagement and signing the report or authorizing another individual to sign it.

Mr. Viera is the engagement partner and is responsible for supervising the engagement. Additionally, Mr. Viera is the only authorized employee of Gustavo A Viera PA to:

  • Sign the Accountants Report
  • Sign any original Local, State or Federal Tax Return
  • Sign any other document(s) not specifically listed herein
  • Authorize the release of original or copies of a clients source documents
  • Authorize the release of original Financial Statements or copies of previously issued Financial Statements
  • Authorize the release of any original Local, State or Federal Tax Return or copies of previously issued Local, State or Federal Tax Return
  • Authorize the release of any original or copies of any other document(s) not specifically listed herein

No documents will be released directly to your attorney, bankers, insurance agents, employee of “THE CLIENT” or other party including Local, State & Federal governmental agencies. All requests shall be addressed to Mr. Viera in writing (email, fax or mail) and the requested documents will be sent to “THE CLIENT” directly. No documents shall me submitted to any third party directly. These request are handled as expediently as possible. However, circumstances such as vacations or holidays may delay the turn around time, so please plan accordingly. If Mr. Viera is out of the office, employees are forbidden to release documents for “THE CLIENTS” protection and security. Gustavo A Viera PA reserves the right to charge an additional fee in accordance to the attached rate sheet.

Prior to preparation and execution of this engagement letter, we discussed with you the fact that we provide clients with levels of service higher than a review, such as audit services, and we explained to you the manner in which such levels of service differ from a review.  We also explained to you that we provide clients with services specifically focused on identifying and addressing weaknesses in internal controls (internal control review), and on searching for the existence of fraud within your company (fraud audit).  We further explained the additional costs associated with such higher and different levels of service.  After consideration of such services, you have informed us that you wish to retain us to perform only the review services described in this letter.

You are responsible for adopting sound accounting policies, for maintaining an adequate and efficient accounting system, for safeguarding assets, for authorizing transactions, for retaining supporting documentation for those transactions, and for devising a system of internal controls that will, among other things, help assure the preparation of proper financial statements.  Furthermore, you are responsible for management decisions and functions, for designating a competent employee to oversee any of the services we provide, and for evaluating the adequacy and results of those services.

You are responsible for the design and implementation of programs and controls to prevent and detect fraud, and for informing us about all known or suspected fraud affecting the Company involving (a) management (b) employees who have significant roles in internal control, and (c) others where the fraud could have a material effect on the financial statements.  You are also responsible for informing us of your knowledge of any allegations of fraud or suspected fraud affecting the Company received in communications from employees, former employees, regulators, or others.  In addition, you are responsible for identifying and ensuring that the entity complies with applicable laws and regulations.

In order for us to complete this engagement, and to do so efficiently, we require unrestricted access to the financial and non-financial documents and individuals within your company, and it’s affiliate offices or locations.  Any failure to provide such cooperation, and to do so on a timely basis, will impede our services, and may require us to suspend our services or withdraw from the engagement.

Our fees for this engagement are not contingent on the results of our services.  Rather, our fees for this engagement are state below.            In the event that we encounter unusual circumstances that would require us to expand the scope of the engagement we will adjust our estimate, and obtain your prior approval before continuing with the engagement. We estimate that our fee for these services will range from approximately $xxxx.00 to xxxx.xx.  You acknowledge that this range is not a limit to the total fees we may charge for our services, and that our fees may actually exceed that range.  However, in the event that we encounter unusual circumstances that would require us to expand the scope of the engagement, and/or if we anticipate our fees exceeding the aforementioned range, we will adjust our estimate, and obtain your prior approval before continuing with the engagement.

Prior to commencing our services, we require that you provide us with a retainer in the amount of  $xxxx.xx.  The retainer will be applied against our final invoice, and any unused portion will be returned to you upon our collection of all outstanding fees and costs related to this engagement.  Our fees and costs will be billed monthly, and are payable upon receipt.  Invoices unpaid 30 days past the billing date may be deemed delinquent, and are subject to an interest charge of 1.0% per month.  In the absence of a written objection to any invoice within 30 days of the invoice date, you will be deemed to have accepted and acknowledged, as correct, the services rendered as described in the invoice and the value thereof.

We reserve the right to suspend our services or to withdraw from this engagement in the event that any of our invoices are deemed delinquent.  In the event that any collection action is required to collect unpaid balances due us, you agree to reimburse us for our costs of collection, including attorneys’ fees.  If we elect to terminate our services for nonpayment, or for any other reason provided for in this letter, our engagement would be deemed to have been completed upon written notification of termination, even if we have not completed our report.  You will be obligated to compensate us for all time expended, and to reimburse us for all of our out-of-pocket costs, through the date of termination.

In connection with this engagement, we may communicate with you or others via email transmission.  As emails can be intercepted and read, disclosed, or otherwise used or communicated by an unintended third party, or may not be delivered to each of the parties to whom they are directed and only to such parties, we cannot guarantee or warrant that emails from us will be properly delivered and read only by the addressee.  Therefore, we specifically disclaim and waive any liability or responsibility whatsoever for interception or unintentional disclosure of emails transmitted by us in connection with the performance of this engagement.  In that regard, you agree that we shall have no liability for any loss or damage to any person or entity resulting from the use of email transmissions, including any consequential, incidental, direct, indirect, or special damages, such as loss of revenues or anticipated profits, or disclosure or communication of confidential or proprietary information.

You are responsible to notify us in advance of your intent to reproduce our report for any reason, in whole or in part, and to give us the opportunity to review any printed material containing our report before its issuance.  Such notification does not constitute an acknowledgement on our part of any third party’s intent to rely on the financial statements.  With regard to financial statements published electronically on your Internet website, you understand that electronic sites are a means to reproduce and distribute information.  We are not required to read the information contained in your sites, or to consider the consistency of other information in the electronic site with the original document.

It is our policy to retain engagement documentation for a period of seven years, after which time we will commence the process of destroying the contents of our engagement files.  To the extent we accumulate any of your original records during the engagement, those documents will be returned to you promptly upon completion of the engagement, and you will provide us with a receipt for the return of such records.

The balance of our engagement file, other than the reviewed financial statement, which we will provide to you at the conclusion of the engagement, is our property, and we will provide copies of such documents at our discretion and if compensated for any time and costs associated with the effort.

In the event we are required to respond to a subpoena, court order or other legal process for the production of documents and/or testimony relative to information we obtained and/or prepared during the course of this engagement, you agree to compensate us at our hourly rates, as set forth above, for the time we expend in connection with such response, and to reimburse us for all of our out-of-pocket costs incurred in that regard.

In the event that we are or may be obligated to pay any cost, settlement, judgment, fine, penalty, or similar award or sanction as a result of a claim, investigation, or other proceeding instituted by any third party, then to the extent that such obligation is or may be a direct or indirect result of your intentional or knowing misrepresentation or provision to us of inaccurate or incomplete information in connection with this engagement, and not any failure on our part to comply with professional standards, you agree to indemnify us, defend us, and hold us harmless as against such obligations.

You agree that any dispute (other than our efforts to collect an outstanding invoice) that may arise regarding the meaning, performance or enforcement of this engagement or any prior engagement that we have performed for you, will, prior to resorting to litigation, be submitted to mediation, and that the parties will engage in the mediation process in good faith once a written request to mediate has been given by any party to the engagement.  Any mediation initiated as a result of this engagement shall be administered within the county of Miami-Dade and Florida, by Mediation Services Inc. according to its mediation rules, and any ensuing litigation shall be conducted within said county, according to Florida law.  The results of any such mediation shall be binding only upon agreement of each party to be bound.  The costs of any mediation proceeding shall be shared equally by the participating parties.

Any litigation arising out of this engagement, except actions by us to enforce payment of our professional invoices, must be asserted within one year from the date any such cause of action accrues, or within three years from the completion of the engagement, whichever is earlier, notwithstanding any statutory provision to the contrary.

This engagement letter is contractual in nature, and includes all of the relevant terms that will govern the engagement for which it has been prepared.  The terms of this letter supersede any prior oral or written representations or commitments by or between the parties.  Any material changes or additions to the terms set forth in this letter will only become effective if evidenced by a written amendment to this letter, signed by all of the parties.  If you would like us to provide you with any other services not specifically outlined in this engagement letter, you must make that request of us in writing.  If we agree to provide the requested additional services, we will create a separate engagement letter specifically addressing the same, and that engagement letter, upon your signature, will govern our provision of those additional services.

If, after full consideration and consultation with counsel if so desired, you agree that the foregoing terms shall govern this engagement, please sign this letter in the space provided and return the original signed letter to me, keeping a fully-executed copy for your records.

Thank you for your attention to this matter, and please contact me with any questions that you may have.

Gustavo A Viera CPA

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