Which of the following circumstances requires an explanatory paragraph in the independent auditors' report? Multiple Choice...
Which of the following circumstances requires an explanatory paragraph in the independent auditors' report? Multiple Choice
A material change from a prior accounting period in the application of an accounting principle.
Basing the opinion in part on the work of another auditor.
Uncertainties about the outcome of a significant event that would have affected the presentation of the financial statements if the outcome could have been estimated.
Substantial doubt about the entity's ability to continue as a going concern.
An explanatory paragraph in the independent auditors’ report is required in each of these circumstances.
Homework Answers
e.An explanatory paragraph in the independent auditors’ report is required in each of these circumstances..
all the given situations warrant an explanatory paragraph in the independent auditor's report.
Material change from prior accounting period in application of accounting principle.
Basing opinion on the work of another auditor
Uncertainities about the outcome of a significant event that would have affected the presentation of financial statements.
Substantial doubt regarding the ability of entity to continue as a going concern.
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