Here is a visual picture that illustrates the different comfort levels someone can draw from financial statements that have been audited, reviewed, or compiled by a CPA.
Here is a picture of assurance levels from reports issues by CPAs.
We CPAs use the word ‘assurance’ when we talk about this concept. This means how much
can a reader of the financial statements rely comfort did the accountant obtain before issuing a report on the on the accountant’s report and the accompanying financial statements.
The concept for the picture above is from the 2010 AICPA NAATS conference. The concept was relayed by a presenter at the Inland Empire chapter of the California Society of CPAs. I don’t know who made the original presentation. If I find out, I shall provide appropriate credit. I have modified the concept in several ways based on my years experience working in the audit profession.
This issue is discussed further in the following post.