Most businesses confuse audits and reviews—they're different services at different price points, with different legal weight. Understanding the distinction can save you thousands and ensure you're getting the assurance level you actually need. This guide breaks down pricing, scope, and when to choose each.
What's the Difference?
An audit is the most rigorous examination. An independent auditor (CPA) tests financial transactions, verifies documentation, and evaluates internal controls using specific audit standards (GAAS, PCAOB). You get an opinion on whether financial statements are presented fairly.
A review is less intensive. The CPA performs analytical procedures and inquiries—no testing of underlying evidence or control evaluation. You get limited assurance that nothing came to their attention suggesting material misstatement, but no formal opinion.
The practical difference: audits carry legal and regulatory weight (required by lenders, investors, regulators). Reviews suit smaller companies, nonprofits, or those needing basic credibility without the full commitment.
Pricing Breakdown
Audit costs typically range from $5,000 to $50,000+ depending on:
- Company revenue ($1M–$10M = roughly $5K–$15K; $10M–$50M = $15K–$40K)
- Complexity (number of locations, accounting systems, transaction volume)
- Industry (nonprofits, government contractors, financial institutions cost more)
- Scope (full audit vs. single-year, carve-outs for certain accounts)
Reviews cost 40–60% less—expect $2,000 to $20,000 based on similar factors.
Hourly rates for audit work run $150–$400+ per hour; review hourly rates fall between $120–$300.
Key Pricing Factors
Transaction volume drives time. A $5M manufacturing company with 2,000 monthly transactions costs less than a $5M SaaS firm with 50,000 cloud-based recurring entries.
Geographic variation matters. NYC, San Francisco, and Boston CPA firms charge 20–40% more than regional firms in smaller metros.
Timing and rush fees apply. Year-end audits requested in February cost more than planned December work. Emergency engagements add 25–50%.
Additional services stack costs: tax compliance, internal controls testing, fraud investigation, remediation work, or compliance certifications (SOC 2, ISO) each add $2K–$10K+.
What's Included in Each Service
| Aspect | Audit | Review | |--------|-------|--------| | Testing | Extensive; tests controls & transactions | Limited; analytical procedures only | | Opinion | Formal opinion on fair presentation | Limited assurance; exceptions noted | | Credibility | Highest; required by most lenders/investors | Moderate; suitable for banks, some investors | | Timeline | 6–12 weeks typical | 3–6 weeks typical | | Cost | $5K–$50K+ | $2K–$20K | | Regulatory acceptance | Yes; legally recognized | Limited; not accepted by SEC, most public investors |
How to Compare Providers
When requesting proposals, specify:
- Scope: Are you asking for a full audit, single-year review, or carve-out (e.g., revenue testing only)?
- Reporting format: Standard unqualified opinion, or do you need specific formats for loan documents?
- Timeline: Interim work available? Compressed deadline?
- Team experience: Ask if they've audited your industry (healthcare CPA vs. tech CPA matters).
- Fee structure: Fixed fee, hourly, or time-and-materials? What triggers scope changes?
Request at least three proposals from firms of similar size and capability. A solo practitioner will quote lower than a Big 4 firm—not always better value.
Mercoly lets you compare trusted Audit & Assurance providers side-by-side, see their pricing structures, and identify specialists in your industry in one place.
Red Flags to Watch
- Vague pricing: "We'll bill hourly and let you know" suggests poor planning.
- No industry experience: A generalist auditor will require extra time learning your business.
- Pressure to expand scope cheaply: If they bundle 10 hours of tax work into a low audit quote, costs will balloon mid-engagement.
- No reference checks: Always contact at least two similar-sized clients.
Frequently Asked Questions
Q: Can I switch from a review to a full audit mid-year? A: Yes, but it adds cost because the auditor must re-test work the reviewer covered. Plan ahead if you anticipate an audit requirement.
Q: Do I need an audit if my bank only asked for a review? A: Not unless your bank updates its requirements, but verify in writing—requirements change, and an audit later becomes retroactively necessary.
Q: What happens if an audit or review finds problems? A: The auditor documents findings in a management letter; you have time to correct material issues before the report is finalized (typically 30–60 days).
Ready to find the right provider? Start comparing auditors and reviewers on Mercoly to get firm pricing and expertise matched to your needs.