The accountant's compilation report as a communication medium: A qualitative descriptive study of the financial information gap among management, lenders and certified public accountants in non-publicly-traded businesses

This research views accounting from the communication prospective and takes the position that the amount of similarity of understanding between the sender and the receiver of accounting communication elements will directly impact the efficiency of the financial communication process. The research is a qualitative descriptive study that compares and contrasts the amount of similar understanding among CPAs, bank lending officers, and business financial managers with regard to various terms and phrases used in the accountant's compilation report as well as the accountant's role in presenting a company's compiled financial statements. A series of questionnaire items together with a Likert scale and the nonparametric Kruskal-Wallis test are used to determine the similarity of respondent's understanding with regard to these accounting communication elements. The results of this research show that in 18 out of 28 total questionnaire items (64%) there were differences in responses among the three groups at a 95% significance level. Further analysis using the Wilcoxon Rank Sum Test indicates that any pairing that includes the CPA group had an increased number of significant differences among group responses to questionnaire items. The results of this research show that appropriate education efforts on the part of organizations, institutions, and financial professionals to improve understanding of common financial terminology and processes is needed. In addition, continued efforts to identify and describe elements of communication theory that can be incorporated into the financial communication process are imperative.