In an engagement to review the financial statements of a nonpublic company, SSARS require the accountant to obtain review evidence that is primarily based
on inquiries and analytical procedures. The nature of the accountant’s inquiries is a matter of judgment. For example, the accountant may consider the nature and materiality of the items, likelihood of misstatement, how the items may be affected by management’s judgment, qualifications of client personnel, among other matters.
Below are several inquiry procedures for the sales and collection cycle:
Revenue
1. Are revenues from the sale of major products and services recognized in the appro-
priate period?
