An independent review entails performing an inquiry into financial statement related matters.
These include accounting principles and practices, record keeping practices, accounting policies, actions of the board of directors and changes in business activity.
The review studies performance related to previous years, ratio analysis and reasonability. The report states that it provides a reasonable basis for expressing limited assurance that there are no known material modifications that should be made to the financial statements to conform with the appropriate accounting framework.
An independent review is required for most companies in South Africa which are not owner-managed. In all but the smallest companies a Registered Auditor is required to perform the review.