When a bonding agent or a lender asks for financial statements, the quality of those statements affects how much capacity they extend. A statement prepared by someone who understands construction reads differently than one that doesn't. We prepare review, compilation, and agreed-upon procedure engagements built around how contractors actually earn revenue.
Most financial statements are prepared as if every business recognizes revenue the same way. Construction doesn't. Percentage-of-completion, work-in-progress, retainage, and over/under-billings all have to be handled correctly, or the statements misrepresent the health of the business. A surety underwriter reading a poorly prepared statement sees risk and prices it into your bonding capacity.
The level of assurance also matters. A compilation, a review, and the procedures behind them each carry a different degree of confidence for the reader. Choosing the right engagement for what your bank or surety requires, and preparing it properly, is the difference between statements that support your program and statements that quietly hold it back.
Review, compilation, and agreed-upon procedure engagements, prepared specifically for contractors. We'll help you determine which one fits what your bank or surety requires during the initial conversation.
It depends on what your bank or surety requires and what you're trying to accomplish. A compilation, a review, and agreed-upon procedures each provide a different level of assurance to the reader. We help you determine the right fit before scoping the engagement, rather than selling you more than you need.
Sureties weigh the quality and credibility of your financial statements heavily. Well-prepared statements, with a correct WIP schedule and clean treatment of billings, give an underwriter confidence, and that confidence often translates into capacity.
Assurance engagements are typically defined, project-based work tied to a reporting period or a specific requirement. Many clients also maintain an ongoing advisory relationship so the underlying books are always assurance-ready.
