Difference between Audit and Review

Key Difference: An audit is bothered or concerned only with the financial statements of an organization or company. On the other hand, a review is bothered or concerned with the growth and development of an organization or company.

There are two different levels of services that one could obtain from a certified public accountant. These are referred to as an audit and a review. The two terms are associated with the subject of Accounting.

Dictionary.com defines Audit as:

An official examination and verification of accounts and records, especially of financial accounts.
A report or statement reflecting an audit; a final statement of account.
The inspection or examination of a building or other facility to evaluate or improve its appropriateness, safety, efficiency, or the like: An energy audit can suggest ways to reduce home fuel bills.
To make an audit of; examine (accounts, records, etc.) for purposes of verification: The accountants audited the company's books at the end of the fiscal year.

In an audit, the accountant is concerned with the financial statements of a company. Audited financial statements provide the user with the auditor’s opinion. It is that the financial statements are presented fairly in all the aspects. The auditor is required by the auditing standards that are generally accepted in the United States of America (GAAS).

Review is all about the description of the performance levels, assessments of the performance of a product or a service offered by the company. In a review, the accountants need to provide limited assurance that financial statements do not have any known errors or departures from the accounting rule found in GAAP.

Comparison between Audit and Review:

	Audit	Review
Description	In Audit, the financial statements that provide the user with the auditor’s opinion that the financial statements, are presented fairly, in all material respects, in conformity with the applicable financial reporting framework.	In Review, the financial statements provide the user with comfort that, based on the accountant’s review, the accountant is not aware of any material modifications that should be made to the financial statements for the statements to be in conformity with the applicable financial reporting framework.
Level	Highest level of financial statement	The next level of financial statement or assurance services
Concerned with	The financial statements of a company	The growth and the development of the company
Objective	To provide basis for expressing an idea or opinion regarding the financial statement taken as a whole	Provide an opinion about the recent developments made by the company in terms of the promotion of a product
Types	Audits are of different types, quality and integrated or differentiated into personal, internal, external, statutory, non-statutory, social, performance and final.	Reviews are of different types and are differentiated into system review, engagement review, firm-on-firm review and association review
Differences in costs for each level	It involves the most work and therefore the cost is substantially higher.	Lower in cost than an audit
Different levels of services for the situations	The situation is usually prepared for companies because outside third parties require an auditor’s opinion	The situation is usually prepared for privately held companies.
Financial statement	Concerned with the financial statements of the company.	Not concerned about the financial statements of the company.