Choose Review Over Full Audit

A review engagement provides limited assurance on your financial statements at a fraction of the cost of a full audit. If your lender or investor requires more than a Notice to Reader but has not specifically mandated an audit, a review engagement under CSRE 2400 delivers the credibility you need without the expense of full audit procedures.

Clean Your Books Before the Review

Reconcile every balance sheet account before your CPA begins the review engagement. Unreconciled bank accounts, outstanding intercompany balances, and unadjusted accruals create analytical procedure exceptions that extend the review engagement timeline and increase fees. Clean books mean your review engagement completes faster with fewer CPA inquiries and follow-up requests.

Ensure ASPE Compliance Year-Round

Your review engagement financial statements must comply with Accounting Standards for Private Enterprises. Waiting until the review engagement begins to address ASPE presentation issues — like revenue recognition, lease classification, or related-party disclosure — creates last-minute corrections that delay the report. Maintaining ASPE-compliant accounting year-round streamlines every review engagement.

Prepare a Complete Trial Balance

Provide your CPA with a fully adjusted trial balance before the review engagement starts. Missing adjusting entries for depreciation, prepaid expenses, or accrued liabilities force your CPA to request additional information, extending the review engagement timeline. A complete trial balance lets the review engagement analytical procedures begin immediately without delays.

Document Related-Party Transactions

Every review engagement requires disclosure of related-party transactions including shareholder loans, management fees, and intercompany charges. CRA also scrutinizes these items on your T2 corporate tax return. Documenting related-party transactions with written agreements and fair market value support before the review engagement prevents both CPA qualifications and CRA reassessments.

Reconcile Tax Provisions to CRA Filings

Your review engagement financial statements must show a corporate tax provision that ties to your T2 return and any instalment payments made. Discrepancies between the review engagement tax expense and CRA filings raise analytical procedure questions and can trigger CRA matching reviews. We reconcile your tax provision against actual assessments before issuing the review report.

Use the Review Report for Better Financing

Banks and lenders offer better terms when your loan application includes CPA-reviewed financial statements from a review engagement rather than basic Notice to Reader compilations. The limited assurance provided by a review engagement gives lenders confidence in your numbers, often resulting in lower interest rates and higher approved credit limits that save your business real money.

Verify Revenue Recognition Accuracy

During any review engagement, your CPA applies analytical procedures to test whether revenue is recognized in the correct period under ASPE section 3400. Revenue recorded too early or too late distorts your review engagement financial statements and misaligns with GST/HST collected on your HST returns. CRA flags revenue timing mismatches during desk reviews.

Disclose All Contingent Liabilities

Your review engagement requires disclosure of pending lawsuits, CRA reassessment disputes, and warranty obligations. Omitting contingent liabilities from your review engagement financial statements can result in a qualified report that undermines stakeholder confidence. Full disclosure during the review engagement protects both your credibility with lenders and your CRA compliance position.

Schedule the Review Engagement Early

Begin your review engagement within 60 days of fiscal year-end so the CPA report is ready before your T2 corporate tax return filing deadline. Late review engagements delay tax filings, which triggers the 5% late-filing penalty on unpaid tax plus 1% per month. Early scheduling ensures both the review report and T2 are completed on time.