• Monica Ștefan

  • Audit Partner

An informed and new perspective or the confirmation of the already known always makes the difference when it comes to effective and efficient management of any business. Our auditing and related services focus on listening and asking the right questions, providing support to improve internal and financial control processes and having the main aim a reliable and relevant reporting.



1. Full-scope financial audit on statutory financial statements prepared in accordance with the current applicable accounting regulations

As per the stipulation of the Order no 1802/2014 and its subsequent amendments, the Statutory Financial Audit is mandatory for the entities which exceed two of the three criteria for two consecutive financial year ( the current year and the previous year):

  • Turnover: over RON 32.000.000 Lei
  • Total assets: over RON 16.000.000 Lei
  • Number of employees : over 50

  • For the large and medium entities (as defined by the Order no 1802/2014 and its subsequent amendments) the annual Financial Statements being subject to audit comprise the following:

  • Balance sheet
  • Statement of Profit and loss
  • Informative Forms F30 and F40
  • Statement of Changes in Equity and Statement of Cash Flows
  • Explanatory notes and Accounting Policies
  • Administrators’ Report
  • 2. Limited reviews of annual financial statements, statutory or prepared in accordance with other financial reporting frameworks and/or special purpose financial statements prepared for group consolidation

    The limited review is a limited assurance engagement which has as objective the reduction of material misstatement risk to an acceptable level, but not at the level of precision entailed by a full-scope audit engagement.
    The level of materiality is higher than that of a full-scope audit engagement, fact which reduces the range of audit evidence deemed as adequate, relevant and sufficient for expressing an opinion.
    We recommend this type of engagement for external reporting packages and special purpose financial statements (e.g. for Group reporting or consolidation purposes, in the event that the instructions do not require otherwise.

    3. Assurance engagements, other than audit or review of historic financial information

    This type of service relates to partial assurance engagements in relation to financial reporting which does not constitute financial statements (forecasted financial information, assurance engagements for pro-forma financial statements included in fusion prospects, etc).
    There are situations in which this type of audit engagement is requested also for the audit of nonrefundable European funds, but this specification must be included expressly in the Solicitant’s Guide or in the specific instructions issued by the Implementation Organism (e.g. an audit report as per ISAE 3000 or ISA 805 is required).

    4. Compilations of annual financial statements, statutory or prepared in accordance with other financial reporting frameworks and/or special purpose financial statements prepared for group consolidation

    The compilation of annual financial statements consists of the preparation of the respective financial statements (annual or for a different period which can be the quarter, semester or month) based on the trial balance provided by the client, but applying the reporting principles and the generally accepted framework - IFRS, US GAAP, UK GAAP, HBII.
    In the compilation process, we request clarifications on the nature of elements included in the trial balance in order to validate the substance of the accounts reported and to understand whether the compiled financial statements reflect the economic reality.
    All corrected and uncorrected adjustments on the initial trial balance provided by the client are included in the compilation report which accompanies the respective financial statements.

    5. Special purpose engagements – agreed-upon procedures

    This is the most frequent type of non-assurance services which allow the auditor to further detail certain areas of interest for the client, without expressing an opinion on the financial statements as a whole.
    Thus, this type of engagement is appropriate when a client wishes to obtain assurance on a specific accounting or internal control area (e.g. certification of turnover for a rent lessee for the purpose of rent adjustment at year end or verification of the reporting method used for old or obsolete inventories, verification of the valuation method of inventories, etc).

    6. Financial-economic analyses on comparative financial statements

    Without a professional opinion being required, we can perform a financial-economic analysis of the relevant indicators for a specific industry and also to perform an analysis of the factors which have determined certain variations in the respective indicators. The variance analysis is usually discussed with other departments aside from Finance with the purpose of financial information validation.
    In this type of engagement, the auditor cannot express an opinion on the financial statements as a whole and neither on whether the indicators’ variances and correct or whether there is a going concern risk.
    This type of engagement is a non-assurance engagement, respectively a compilation of this internal analysis for the entity or for third parties (e.g. a liquidity analysis for the bank or an analysis of stock rotation).

    7. Audit engagements for projects financed from European funds or other nonrefundable sources

    We have been performing this type of engagements since 2002 when there existed the PHARE non-reimbursable funds and we had the pleasure to actively participate in consulting missions alongside Moore Stephens Europe for the European Commission, with the purpose of establishing the contents of the audit report suitable for this type of nonrefundable finance.
    An audit report on non-reimbursable funds is usually a report over payment requests or over the intermediate/final financial reports. These payment requests and financial reports contain financial elements presented in the annual financial statements, but based on different reporting rules, such as “cash-based accounting” - settlement of the payments made by the Beneficiary entity - rather than based on the principles of “accrual-basis accounting”, as the statutory financial statements.>br> Considering the above, in our opinion these reporting elements for European funds or other non-reimbursable funds do not constitute a part of the annual financial statements unless they have the same reporting framework.
    Consequently, the report we recommend for this type of engagement is the one for agreed-upon procedures, as per ISRS 4400, in which the auditor describes in detail the procedures performed, the areas analyzed and the related findings. This type of report offers the users the possibility to decide themselves on the relevant conclusions, based on the presented observations.
    The transition to structural funds at national level has determined the expansion of this reporting area, such that at the present moment the Ministry of European Funds allows the implementation organisms to request both audit reports as per ISRS 4400, as well as reporting in compliance with ISAE 3000 or ISA 805.

    8. Financial due-diligence engagements

    In the case of a business acquisition (even a partial one), boith the buyer and the seller may perform a due diligence on their entity or on the targeted one, in order to ascertain the financial and/or fiscal risks to which they are exposed. The report will provide a detailed description of the business, a financial and economic analysis mutually agreed-upon and a detailed presentation, on areas, of the most significant observations and risks identified.
    In practice, this type of engagement is described as „quick and dirty” as it is performed in a short period of time, there are information limitations depending on the „ data room” provided by the target entity and it does not offer the possibility of a detailed analysis (the reason why it is recommended to establish a relevant and reasonable materiality level) and allows the audit team to specify the significant risks identified, either from documents or discussion with the target entity personnel, but without a complete validation.
    Usually, we recommend that this type of engagement be performed in corroboration with a legal due diligence, such as to allow the analysis of the target entity’s set up, of all compulsory authorizations, but also the commercial and legal analysis of existing contracts.

    9. Internal audit engagements for companies

    The entity’s management is responsible for the preparation and faithful presentation of the financial statements in accordance with the applicable accounting regulations
    This responsibility includes: the design, implementation and maintenance of a internal control environment relevant for the preparation and faithful presentation of financial statements which are free from material misstatements due to fraud or error; the selection and application of appropriate accounting policies; the use of accounting estimates reasonable in the given circumstances
    The internal audit’s main target are the existing internal control processes and procedures, the ones which ensure the proper internal functioning of the entity, such that financial information is accurately recorded and presented.

    10. Professional training on specific topics

    We organize professional trainings dedicated to our clients, on specific topics chosen by them or areas where they are interested on expanding their accounting knowledge, especially IFRS reporting.
    We offer our clients the opportunity to inform us as to which topics they wish a more comprehensive understanding of and, to the extent to which we can assist with professional training, we do so in a dedicated manner, with focus on practical examples from their specific industries.
    Up to now, we have organized requested professional training on the following topics:

  • Comparison between Romanian Accounting Standards and IFRS on general interest areas – fixed assets, inventories, accounts receivable, cash, liabilities, etc.
  • Deferred tax – conceptual aspects and accounting treatment
  • What is the Audit Risk and how it affects an audit engagement
  • What is the purpose of Account 711 in accounting – practical examples