The firm of Kay and Cee, CPAs, was engaged to perform a compilation of TCV Corporation, a private company, for the year ended 2010. The owner of TCV Corporation signed the engagement letter provided by Kay and Cee and then provided all the underlying data needed for the financial statements. Kay and Cee knew the industry and was acquainted with TCV Corporation because it had prepared the corporate tax return the prior year.

(a) TCV Corporation requests that Kay and Cee compile the financial statements in accordance with generally accepted accounting principles and include all the appropriate disclosures. Kay and Cee determine that they are independent of TCV Corporation and at the end of their work conclude that, on the face, there are no problems with the financial statements as they are compiled. The financial statements are for management use only, and even though TCV Corporation management signed the written engagement letter, Kay and Cee choose to issue a compilation report to accompany the financial statements.

(b) Instead of engaging them to compile the financial statements, TCV Corporation hires Kay and Cee to review its financial statements for the year ended 2010. What steps do Kay and Cee have to carry out as part of the review?