Who needs a review
Law No. 06/L-032 on Accounting, Financial Reporting and Audit classifies companies as micro, small, medium-sized or large on three criteria measured on the last day of the previous financial year: total assets, net turnover and the average number of employees. For small and medium-sized companies, the type of engagement does not depend on the category but on a single figure: annual net turnover of EUR 4,000,000.
| Category | Annual net turnover | What is required |
|---|---|---|
| Micro | Any | Neither review nor audit; reporting under the KCFR instructions only |
| Small or medium | Up to EUR 4,000,000 | Review report by an independent auditor (Article 8.1.3) |
| Small or medium | Above EUR 4,000,000 | Audit opinion and statement of compliance (Article 8.1.1–8.1.2) |
| Large | Any | Mandatory audit (Article 7) |
So a medium-sized company that reached its category through assets and headcount, but with turnover below EUR 4 million, stays with a review. You can check your category in seconds with the KCFR company-size calculator.
What a review is, and what it is not
A review is an engagement of an independent auditor under the International Standard on Review Engagements 2400 (ISRE 2400). The law states expressly that all review engagements are carried out by statutory auditors under this standard (Article 10, paragraph 6). The accountant who keeps your books cannot issue this report.
A review gives limited assurance. The work rests mainly on analytical procedures and on enquiries of management and the accountant, without the extensive testing of an audit: usually no confirmations from banks, customers and suppliers, and no attendance at the stock count. The conclusion is therefore given in negative form: the auditor states that nothing has come to their attention that causes them to believe the statements are not prepared in accordance with the applicable framework.
This makes a review shorter and less costly than an audit. But the assurance is lower, and some banks, donors and tenders ask expressly for audited statements. The full comparison, and when a voluntary audit is worth it, is on the financial statement audit page.