Russ Major, CPA, drafted the following report on October 25, 2011 at the completion of the engagement to compile the financial statements of Ajax Company for the year ended September 30, 2011 Ajax is a nonpublic entity in which Major 's child has a material direct financial interest Ajax decided to...

Deficiencies in the report on the compiled financial statements are as follows Within the first para ...

Russ Major, CPA, drafted the following report on October 25, 2011 at the completion of the engagement

Question:

Russ Major, CPA, drafted the following report on October 25, 2011 at the completion of the engagement to compile the of Ajax Company for the year ended September 30, 2011. Ajax is a nonpublic entity in which Major's child has a material direct financial interest. Ajax decided to omit substantially all of the disclosures required by because the will be for management's use only. The statement of cash flows was also omitted because management does not believe it to be a useful financial statement.
To the Board of Directors of Ajax Company:
I have compiled the accompanying of Ajax Company as of September 30, 2011, and for the year then ended. I planned and performed the compilation to obtain limited assurance about whether the are free of material misstatements.
A compilation is limited to presenting information in the form of It is substantially less in scope than an audit in accordance with generally accepted auditing standards, the objective of which is the expression of an opinion regarding the taken as a whole. I have not audited the accompanying and, accordingly, do not express any opinion on them.
Management has elected to omit substantially all of the disclosures required by generally accepted accounting principles. If the omitted disclosures were included in the they might influence the user's conclusions about the Company's financial position, results of operations, and changes in financial position.
I am not independent with respect to Ajax Company. This lack of independence is due to my child's ownership of a material direct financial interest in Ajax Company.
This report is intended solely for the information and use of the Board of Directors and management of Ajax Company and should not be used for any other purpose.
Required
Identify the deficiencies contained in Major's report on the compiled Group the deficiencies by paragraph when applicable. Do not redraft the report?
Financial Statements
Financial statements are the standardized formats to present the financial information related to a business or an organization for its users. Financial statements contain the historical information as well as current period’s financial... GAAP
Generally Accepted Accounting Principles (GAAP) is the accounting standard adopted by the U.S. Securities and Exchange Commission (SEC). While the SEC previously stated that it intends to move from U.S. GAAP to the International Financial Reporting Standards (IFRS), the...