What is a compilation? A compilation is presenting in the form of financial statements information that is the representation of management (owners) without any undertaking to express any assurance on the statements.
An example of a compilation report would be taking your internally generated financial information and organizing it in financial statement form. When doing so, no procedures or testing is performed and no assurances are provided on the financial statements.
You may be considering business expansion or acquiring a new business. Such action usually requires the preparation of a forecast or projection. A compilation report would be issued with the forecast or projection since the financial information would be based on the representations of management.