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A review engagement in Canada gives limited assurance on your financial statements: less than an audit, more than none. The accountant mostly asks questions and compares numbers, so you prepare by closing the books and having an answer for every odd line. The standard is CSRE 2400, effective for periods ending on or after December 14, 2017.
What is a review engagement, and how is it different from an audit?
An audit aims at reasonable assurance that the statements are free of material misstatement. A review aims lower. CPA Canada describes the work as inquiry, discussion and analytical procedures rather than the deeper testing of an audit.
| Audit | Review | |
|---|---|---|
| Assurance level | Reasonable | Limited |
| Canadian standard | Canadian Auditing Standards (CAS) | CSRE 2400 |
| Main methods | See the CAS | Inquiry and analytical procedures |
We couldn’t confirm typical fees or timelines from an official source, so we’ve left them out. Ask for a written quote and scope.
Who asks for a review?
Someone outside the business, usually: a lender, an investor, a landlord or a grant program. They decide what level of assurance they want, and it’s in their paperwork.
Read the exact wording. “Reviewed statements” and “audited statements” aren’t interchangeable, and finding out late is expensive. Say a bank in Winnipeg asks for “year-end financial statements” and nothing more. Phone the loan officer and ask which level they’ll accept before you pay anyone. One short call can save you from buying the wrong product.
If the business is a federal corporation, the CBCA lets shareholders of a non-distributing corporation resolve not to appoint an auditor, but only if every shareholder agrees, and only until the next annual meeting. You can read the rule in section 163 of the CBCA. A review is not that resolution. It’s a separate service people sometimes choose where no audit is required.
How do you prepare for a review engagement in Canada?
Get the year closed first. That means bank accounts reconciled, receivables and payables listed, payroll remittances matched to your records and the trial balance final before anyone arrives. An accountant who’s asking about your numbers on day one shouldn’t find an unfinished ledger.
Then decide which framework the statements use. Private enterprises can choose ASPE (Part II of the CPA Canada Handbook) or IFRS (Part I). Which one fits is a decision for you and your accountant, and it belongs before year-end, not after.
Pull the documents together in one folder: bank statements, loan agreements, the fixed-asset list, share records and minutes. The CRA’s rule is to keep records six years from the end of the last tax year they relate to, and some, like share registers, indefinitely, so most of this should exist already.
One last bit of prep that costs nothing: decide who the accountant will talk to. Pick the person who actually knows why a number looks the way it does, whether that’s you, a bookkeeper or the office manager, and keep them free for a day or two. Reviews run on conversations.
What will the reviewer ask about your numbers?
Expect questions on anything that changed. Analytical procedures compare this year to last year and to what makes sense for your business. If your gross margin slips, you’ll be asked why.
Here’s a case. Last year you sold an item at $900 with a cost of $630, a 30.0% gross margin. This year the cost rose to $648 on the same price, and the profit margin calculator shows 28.0%. A two-point drop is small, but you should be able to say it came from supplier costs and not from a mispriced sale or a missing invoice. Run your own comparison with the percentage calculator, and check whether an investment behind a big balance made sense with the ROI calculator.
The same goes for a line that jumped. Rent up 40 per cent? Have the new lease handy. A bonus paid in January? Have the board minute. The goal isn’t to have a perfect year. It’s to have an answer for every odd one.
Mistakes that slow a review down
Handing over books that don’t reconcile is the classic one. So is a missing explanation for a large one-off entry, such as a shareholder loan or a bonus paid after year-end. Don’t guess at answers either. “I’ll check and send it tomorrow” costs less than a wrong statement to your reviewer.
Don’t expect a review to do an audit’s job. Limited assurance is limited. And if your tax figures come into it, the corporate tax calculator gives a rough estimate only, since it ignores credits and handles associated corporations only through an optional box.
How we checked the figures
Checked in November 2026. The CSRE 2400 effective date and description come from CPA Canada’s audit and assurance alert on CSRE 2400. The shareholder audit exemption is from section 163 of the Canada Business Corporations Act, and record-keeping periods are from the Canada Revenue Agency. We found no later change to the 2017 effective date. The margin example comes from our own calculator. For related reading see what audit committees do, materiality in financial reporting and financial statements and business loans.
Frequently asked questions
What is a review engagement in Canada?
It is an accountant's check of your financial statements that gives limited assurance. The work is mainly inquiry and analytical procedures under CSRE 2400, not the deeper testing of an audit. A review report says nothing came to the accountant's attention that the statements are materially misstated, which is a lower level of comfort.
Is a review the same as an audit?
No. An audit aims at reasonable assurance under the Canadian Auditing Standards, while a review aims at limited assurance under CSRE 2400. Lenders and investors name the level they want, so read the wording in their paperwork and phone them before you buy the wrong one.
When did CSRE 2400 take effect?
CPA Canada says CSRE 2400 applies to reviews of financial statements for periods ending on or after December 14, 2017. It was approved in 2015, published in the CPA Canada Handbook in 2016, and early adoption was not allowed. We found no later change to that date.
Can a private company skip the audit?
Under section 163 of the CBCA, shareholders of a corporation that is not a distributing corporation can resolve not to appoint an auditor, but every shareholder must consent. The resolution is valid only until the next annual meeting. A review is a separate service and does not replace that resolution.
How long should I keep the records the reviewer sees?
The CRA says generally six years from the end of the last tax year they relate to. Some records, such as long-term property records, are kept longer. Put bank statements, loan agreements, the fixed-asset list, share records and minutes in one folder before the reviewer arrives.
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