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Question: Compilation Presentation Alternatives. Jimmy C. operates a large service station, garage, and truck stop on Interstate 95 near Plainview. His brother, Bill, has recently joined him as a partner, even though he will continue his small CPA practice. One slow afternoon, they were discussing financial statements with Bert, the local CPA who operates the largest public practice in Plainview. Jimmy: The business is growing, and sometimes I need to show financial statements to parts suppliers and the loan officers at the bank. Bert: That so? Bill: Heck, Jimmy, I know all about that. I can compile a jim-dandy set of financial statements for us. Bert: Bill can't do compiled financial statements for you. He's not independent. Jimmy: I know. Momma didn't let him outa the house 'til he was 24. The neighbors complained. Bert: That so? Bill: Shucks.
Required: Think about the financial disclosure problems of Jimmy and Bill's small business.
a. Why does Jimmy need a compilation service?
b. What types of compiled financial statements can be prepared for them and by whom?
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