Question

Check my w Select the necessary words from the list of possibilities to complete the following statements Answer Statements When a nonpublic client elects to change accounting principles from one acceptable principle to another acceptable principle and the auditors agree the change is desirable, they should issue a report with an) opinion 2. Audit reports issued under GAAS ordinarily are signed with the name of the If the auditors have examined the prior year's financial statements presented for comparative purposes, they should their opinion for any new information Responsibility for the preparation and fair presentation of the financial statements rests with the If a scope limitation is so severe that a qualified opinion is inappropriate, the auditors should issue an) < Prev Prev 4 of 4 4 of 4 ! search

Answer 1

1. basis for modification paragraph (basis for qualified opinion paragraph)

Change in Accounting Principle, even though desirable, results in violation of Consistency principle (consistent application of GAAP). Thus, the auditor has to take into consideration the Consistency principle and provide a qualified opinion in his audit report.

2. CPA Firm

The audit report is the responsibility of the auditor, who is ultimately representing the audit firm. Thus, the audit report under GAAS will be signed under the name of the CPA firm.

3. update

The auditor should revise or update his opinion on any new information available.

4. management

Preparation and fair presentation of Financial statements is the responsibility of the management. The auditor is allowed to express an opinion on the same.

5. disclaimer of opinion

A disclaimer of opinion is issued when an auditor is unable to form an opinion due to incomplete information or as in this case - the scope limitation is severe.