Ordinarily,a public company must be addressed to: \(\begin{array}{lll}&\text { Shareholders } & \text { Board of Directors } \\ \text { A. } & \text { Yes } & \text { Yes } \\ \text { B. } & \text { Yes } & \text { No } \\ \text { C. } & \text { No } & \text { Yes } \\ \text { D. } & \text { No } & \text { No } \end{array}\)

A) Option A B) Option B C) Option C D) Option D A) Option A B) Option B C) Option C D) Option D

Exam 17: Auditors Reports

The Rotter Company, a nonpublic company,changed accounting principles in 20X4 from those followed in 20X3.The auditor believes that the new principles are not in conformity with GAAP,and therefore that the 20X4 financial statements are misleading due to pervasive misstatements.The change (including its dollar effect)has been described in the notes to the 20X4 statements.Under these circumstances,in reporting on the 20X4 financial statements,the auditor should:

(Multiple Choice)

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(79)

Question 21

Ordinarily,a public company must be addressed to: Shareholders Board of Directors A. Yes Yes B. Yes No C. No Yes D. No No

(Multiple Choice)

4.8/5

(88)

Question 22

If financial statements of a public company fail to disclose a material fact,the auditors may disclose the information in an additional paragraph added to the report and,depending upon materiality,issue either a qualified opinion or adverse opinion on the statements.

(True/False)

4.7/5

(79)

Question 23

If audited financial statements include a balance sheet and an income statement,but do not include a statement of cash flows:

(Multiple Choice)

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Question 24

After performing all necessary procedures,the predecessor auditors reissue a prior-period report on financial statements at the request of the client without revising the original wording.The predecessor auditors should:

(Multiple Choice)

4.8/5

(78)

Question 25

When financial statements of a prior period are presented on a comparative basis with financial statements of the current period,the continuing auditor is responsible for:

(Multiple Choice)

4.7/5

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Question 26

Which of the following is least likely to be a critical audit matter in a public company audit report?

(Multiple Choice)

4.9/5

(81)

Question 27

When an auditor of financial statements has substantial doubt about an entity's ability to continue as a going concern,the auditor most likely would express a qualified or adverse opinion if:

(Multiple Choice)

4.8/5

(88)

Question 28

When an auditor of a nonpublic company has concluded there is substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time beyond the date the financial statements will be released (1/26/X2),the auditor's responsibility includes:

(Multiple Choice)

4.8/5

(88)

Question 29

A basis for modification paragraph in the audit of the financial statements of a nonpublic company:

(Multiple Choice)

4.7/5

(74)

Question 30

A public company's financial statements should be prepared following standards of the Public Company Accounting Oversight Board.

(True/False)

4.8/5

(81)

Question 31

A client has changed the salvage values of a number of its fixed assets.The auditors of the public company believe that the revised salvage values are realistic.The appropriate report on the financial statements is:

(Multiple Choice)

4.8/5

(67)

Question 32

When the auditor is unable to determine the amounts associated with noncompliance with a law by client personnel due to a scope limitation,the auditor should issue a(an):

(Multiple Choice)

4.8/5

(77)

Question 33

After considering an entity's negative trends and financial difficulties,an auditor has substantial doubt about the entity's ability to continue as a going concern.The auditor's considerations relating to management's plans for dealing with the adverse effects of these conditions most likely would include management's plans to:

(Multiple Choice)

5.0/5

(97)

Question 34

When there is substantial doubt about a company's ability to remain a going concern,with the matter properly disclosed in the financial statements,the report issued is unmodified with an emphasis-of-matter paragraph or a disclaimer of opinion.

(True/False)

4.9/5

(91)

Question 35

When the auditors of a nonpublic company are unable to comply with generally accepted auditing standards,they should issue an opinion that is unmodified,but include an additional emphasis-of-matter paragraph in the report.

(True/False)

4.8/5

(89)

Question 36

A change that the auditor agrees with from one generally accepted accounting principle to another generally accepted accounting principle that has a pervasive effect on net income usually results in an audit report with unmodified opinion and an emphasis-of-matter paragraph.

(True/False)

4.8/5

(74)

Question 37

An audit client has refused to allow the auditors to perform an auditing procedure and there are no other effective alternate procedures available.The circumstance would normally result in the issuance of:

(Multiple Choice)

5.0/5

(67)

Question 38

A basis for modification paragraph for a nonpublic company is least likely to relate to which of the following types of opinion?

(Multiple Choice)

4.8/5

(77)

Question 39

Which of the following would most likely be an appropriate addressee for an audit report?

(Multiple Choice)

4.8/5

(76)

Question 40

Showing 21 - 40 of 73

Ordinarily,a public company must be addressed to: Shareholders Board of Directors A. Yes Yes B. Yes No C. No Yes D. No No

If financial statements of a public company fail to disclose a material fact,the auditors may disclose the information in an additional paragraph added to the report and,depending upon materiality,issue either a qualified opinion or adverse opinion on the statements.

If audited financial statements include a balance sheet and an income statement,but do not include a statement of cash flows:

After performing all necessary procedures,the predecessor auditors reissue a prior-period report on financial statements at the request of the client without revising the original wording.The predecessor auditors should:

When financial statements of a prior period are presented on a comparative basis with financial statements of the current period,the continuing auditor is responsible for:

Which of the following is least likely to be a critical audit matter in a public company audit report?

When an auditor of financial statements has substantial doubt about an entity's ability to continue as a going concern,the auditor most likely would express a qualified or adverse opinion if:

When an auditor of a nonpublic company has concluded there is substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time beyond the date the financial statements will be released (1/26/X2),the auditor's responsibility includes:

A basis for modification paragraph in the audit of the financial statements of a nonpublic company:

A public company's financial statements should be prepared following standards of the Public Company Accounting Oversight Board.

A client has changed the salvage values of a number of its fixed assets.The auditors of the public company believe that the revised salvage values are realistic.The appropriate report on the financial statements is:

When the auditor is unable to determine the amounts associated with noncompliance with a law by client personnel due to a scope limitation,the auditor should issue a(an):

When there is substantial doubt about a company's ability to remain a going concern,with the matter properly disclosed in the financial statements,the report issued is unmodified with an emphasis-of-matter paragraph or a disclaimer of opinion.

When the auditors of a nonpublic company are unable to comply with generally accepted auditing standards,they should issue an opinion that is unmodified,but include an additional emphasis-of-matter paragraph in the report.

A change that the auditor agrees with from one generally accepted accounting principle to another generally accepted accounting principle that has a pervasive effect on net income usually results in an audit report with unmodified opinion and an emphasis-of-matter paragraph.

An audit client has refused to allow the auditors to perform an auditing procedure and there are no other effective alternate procedures available.The circumstance would normally result in the issuance of:

A basis for modification paragraph for a nonpublic company is least likely to relate to which of the following types of opinion?

Which of the following would most likely be an appropriate addressee for an audit report?

The Role of the Public Accountant in the American Economy

Professional Standards

Professional Ethics

Legal Liability of Cpas

Audit Evidence and Documentation

Audit Planning, understanding the Client, assessing Risks, and Responding

Internal Control

Consideration of Internal Control in an Information Technology Environment

Audit Sampling

Cash and Financial Investments

Accounts Receivable, notes Receivable, and Revenue

Inventories and Cost of Goods Sold

Property,plant,and Equipment: Depreciation and Depletion

Accounts Payable and Other Liabilities

Debt and Equity Capital

Auditing Operations and Completing the Audit

Integrated Audits of Public Companies

Additional Assurance Services: Historical Financial Information

Additional Assurance Services: Other Information

Internal, operational, and Compliance Auditing

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