Exam 18: Reports on Audited Financial Statements

When audited financial statements are presented in a document containing other information,the auditor

A scope limitation results from an inability to obtain sufficient appropriate evidence about some component of the financial statements.

Which of the generally accepted auditing standards of reporting would not normally apply to special reports such as cash basis statements?

A predecessor auditor should complete the following before reissuing a report on statements presented on a comparative basis:

Which of the following conditions or events most likely would cause an auditor to have substantial doubt about an entity's ability to continue as a going concern?

A scope limitation sufficient to preclude an unqualified opinion always will result when management

When audited financial statements are presented in an entity's document containing other information,the auditor should

In the auditor's report,the principal auditor decides not to make reference to another CPA who audited an entity's subsidiary.The principal auditor could justify this decision if,among other requirements,the principal auditor

The predecessor auditor,after properly communicating with the successor auditor,has reissued a report because the entity desires comparative financial statements.The predecessor auditor's report should make

Changes that do not affect consistency are normally disclosed in the footnotes but do not require an explanatory/emphasis-of-matter paragraph in the audit report.

Which of the following would not require an explanatory/emphasis-of-matter paragraph in the auditor's report?

An auditor must disclaim an opinion when the auditor lacks independence.

Which of the following circumstances normally does not affect the consistency phrase in the auditor's standard report?

A going concern issue requires a modification of the three-paragraph standard unqualified audit report (public company).

An auditor may reasonably issue an "except for" qualified opinion for

When are an auditor's reporting responsibilities not met by attaching an explanation of the circumstances and a disclaimer of opinion to the entity's financial statement?

Which of the following parties is responsible for the fairness of the representations made in financial statements?

For each of the following situations,indicate what type of audit report is most appropriate. a.The auditor lacks independence in fact,but not necessarily in appearance. b.There is a scope limitation and it is material but the overall financial statements are still presented fairly. c.The uncorrected misstatements are immaterial. d.There is a departure from GAAP and it is pervasively material.

Identify the special purpose framework used in each of the following situations. 1.A real estate company reports to its partners on the basis used to complete the income tax return. 2.A company has its financial statements prepared on a price-level adjusted basis as required by its lender. 3.An insurance company reports in compliance with the rules of a state insurance commission. 4.A partnership reports on revenues received and expenses paid. What modifications must be made to the standard auditor's report for these situations?

When the entity fails to include information that is necessary for the fair presentation of financial statements in the body of the statements or in the related footnotes,it is the responsibility of the auditor to present the information,if practicable,in the auditor's report and express a(n)