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Under the Sarbanes-Oxley Act, the CEO and CFO certify that they A. Are responsible for evaluating the effectiveness of intern

Principles of auditing
ch3

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Answer #1

1.

As per sarbanes oxley act, 2002
the CEO and CFO have to individually certify 2 things.

  1. the internal control system provides them with the sufficient information on timely basis which they need
  2. That they have evaluated the internal control system and it was found sufficient for the organisation.

So, option A is correct answer (i.e it is CFO and CEO's responsibility to evaluate internal control system.)


2.
When the auditor, is unable to obtain sufficient and appropriate audit evidence, whether the financial statement is materially misstated or not and the auditor is unable to form an opinion on financial statement.
The auditor gives and disclaimer of opinion.

In the given situation, the management was not able to justify the change in accounting policies.
Therefore due to the lack of audit evidences, the auditor may not be able to form an opinion on the financial statement and would have given a disclaimer of opinion.
so, the given statement is "True".


3.

The given statement is "true".

Explanation

The auditor gives an unqualified opinion when he has a positive opinion about the financial statement.
And when the auditor is able to obtain sufficient and appropriate audit evidences that the financial statement is free from any material misstatement and is fairly presented.
Then the auditor gives an "unqualified report"

Therefore, the given statement is true i.e (the unqualified report attest the investor to make investment in the clients entity.)

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