- What is the purpose of a comfort letter?
- Who signs a comfort letter?
- How do you write a comfort letter?
- What is a cold comfort letter?
- Can a CPA write a comfort letter?
- What is a SAS 72 comfort letter?
- What is a SAS 100 review?
- Is letter of comfort a guarantee?
- What is examination of prospective financial information?
- What is negative assurance in audit?
What is the purpose of a comfort letter?
What Is a Comfort Letter.
A comfort letter is a business document that is intended to assure the recipient that a financial or contractual obligation with another party can and will be met.
The sender is often an independent auditor or accountant..
Who signs a comfort letter?
The comfort letter can be issued by a Certified Public Accountant declaring no indication of false or misleading information in the financial statements and that the company’s prospectus follows the prevailing accounting standards. This is sometimes used in connection with an initial public offering.
How do you write a comfort letter?
TipsKeep warm tone of the letter;Try not to describe in detail why you feel sorry for the addressee (i.e. Do not disassemble the prime factors of failure);In private letters, line refers to the emotions;More items…
What is a cold comfort letter?
comfort letter. in underwriting , a letter from an independent auditor reporting the procedures followed in reviewing unaudited financial statements and other data in preparing the registration statement and prospectus. Sometimes called cold comfort letter.
Can a CPA write a comfort letter?
CPAs are regularly asked to provide a loan broker, lender or other third party with a comfort letter or verification letter on behalf of their clients. … Some lenders make requests for the CPA to provide information regarding their clients that the CPA cannot provide (e.g. solvency request).
What is a SAS 72 comfort letter?
A SAS 72 auditor representation letter (also called, among other things, a SAS 72 letter, an underwriter representation letter or auditor representation letter) may be delivered by the underwriters or certain other parties to an issuer’s independent accountants (referred to herein as auditors) in connection with that …
What is a SAS 100 review?
In November 2002, the Auditing Standards Board (ASB) issued Statement on Auditing Standards (SAS) 100, Interim Financial Information, which supersedes SAS 71. … The SEC requires public companies to engage an independent accountant to review interim financial information before it is included on Form 10-Q or Form 10-QSB.
Is letter of comfort a guarantee?
Comfort letters (also called letters of awareness, letters of support, letters of responsibility and letters of patronage) are a hybrid between a guarantee and making no commitments at all. … They are usually used where the issuer is unable or unwilling to give a guarantee, but wishes to give some comfort to the lender.
What is examination of prospective financial information?
An examination of prospective financial information aims to issue an opinion on whether the prospective financial information was, or not, properly prepared on the basis of stated assumptions, including a negative assurance statement on which those assumptions provide, or not, a reasonable basis for the preparation of …
What is negative assurance in audit?
Negative assurance is a determination by an auditor that a particular set of facts is believed to be accurate since no contrary evidence has been found to dispute them. Negative assurance is normally used by auditors in situations where it is not possible to positively confirm the accuracy of financial reports.