A manager is explaining to a staff auditor how various situations might affect the audit opinion. For each of the following scenarios, identify the appropriate reporting option by matching the scenario with the opinion type from the list provided. Assume that any financial statement effect is material, unless otherwise noted and that US auditing standards are followed.
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A manager is explaining to a staff auditor how various situations might affect the audit opinion....
For each of the following independent situations, assume that any amounts would be material. (I) Indicate the TYPE of appropriate audit report; A. unqualified, B. qualified or adverse, C. qualified or disclaimer, D. Disclaimer, E. Qualified only, or F. Other. INDICATE the situation involved, i.e. “Accounting situation”, and DISCUSS the situation. (II) State whether an explanatory paragraph [i.e. PCAOB audit] would be included, and if so, what would be included in the explanatory paragraph....
The auditor's responsibility section of the standard audit report states that the auditor is (15 A) responsible for the financial statements and the opinion on them B) responsible for the financial statements C) responsible for the opinion on the financial statements .D) jointly responsible for the financial statements with management If the balance sheet of a private company is dated December 31, 2011, the audit report is dated February (16 8, 2012, and both are released on February 15, 2012,...
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Chapter 18 For each of the following independent situations, assume that any amounts would be material (1) Indicate the TYPE of appropriate audit report; A. unqualified, B. qualified or adverse, C. qualified or disclaimer, D. Disclaimer, E. Qualified only, or F. Other. INDICATE the situation involved, Le. "Accounting situation", and DISCUSS the situation. (1) State whether an explanatory paragraph (i.e. PCAOB audit] would be included, and if so, what would be included in the explanatory paragraph. (H)...
1. Which of the following are the established criteria against which management's assertions are judged in an audit? a- Generally Accepted Accounting Principles - Generally Accepted Auditing Standards C- Consistently Reported Accounting Procedures d- Fairness in application of accounting principles 2. Which of the following criteria is unique to the auditors assurance function? a. General competence b- Familiarity with the particular industry of which the client is part C- Due professional care d- Independence 3. Independent auditing can best be...
Name the type of opinion indicated by each of the following situations: a. There is a material uncertainty. b. There was a change in accounting principle. c. There is no material scope limitation or material departure from GAAP. d. The financial statements do not present fairly the financial position, results of operations, or cash flows of the entity in conformity with GAAP. E. Except for the effects of the matter(s) to which the qualification relates, the financial statements present fairly,...
1A qualified opinion that is issued because of a departure from generally accepted accounting principles should contain a separate paragraph explaining the departure and its effects. True False 2 The introductory paragraph of the auditors’ report clarifies management’s responsibility for the financial statements. True False 3The phrase “generally accepted auditing standards” appears in the scope paragraph of the auditors’ standard report. True False 4An auditors’ report is in essence a guarantee by the auditors that the financial statements are correct....
Match each statement below with the type of audit opinion/report that would most likely be issued in the circumstance. Answer choices may be used once, multiple times, or not at all. (1)The auditors determined that sufficient appropriate evidence could not be obtained because inventory records were destroyed in a fire. (2)The client failed to write down certain assets that it determined were impaired. The reasons for reporting the assets at cost instead were disclosed in the notes to the financial...
For each of the following independent situations, assume that any amounts would be material. (I) Indicate the TYPE of appropriate audit report; A. unqualified, B. qualified or adverse, C. qualified or disclaimer, D. Disclaimer, E. Qualified only, or F. Other. INDICATE the situation involved, i.e "Accounting situation", and DISCUSS the situation. (II) State whether an explanatory paragraph [i.e. PCAOB audit] would be included, and if so, what would be included in the explanatory paragraph. (III) For an UNQUALIFIED auditor's report, if the wording...
The accounting and auditing literature discuss several different types of accounting changes. For each of the changes listed below (a through d), indicate whether the auditor should add a paragraph to the audit report, assuming that the change had a material effect on the financial statements and was properly justified, accounted for, and disclosed. Assume that the organization is a U.S. nonpublic company. a. Change from one GAAP to another GAAP b. Change in accounting estimate not affected by a...
All Requirment of the questions are given below: We need to choice answer from (a-e). Assume you are the partner in charge of the 2019 audit of Cobra Corporation, a public company. The audit report has not yet been prepared. In each independent situation following (1-4), indicate the appropriate action (a-e) to be taken. The possible actions are as follows: a. Issue a standard unqualified report. b. Qualify the opinion. c. Issue an unqualified opinion with an explanatory/emphasis of matter...