A CPA's Audit Client Is a Small Charity Which Funds

A CPA's audit client is a small charity which funds development projects in a small foreign country.Most of its donations come in the form of cash,with tax receipts issued to the donors.Included in the cash receipts are weekly donations by one person,Mr.X,whose last name is easily identifiable as coming from that foreign country.Some of these cash donations exceed $10,000.The CPA once asked about Mr.X and accepted as an answer that Mr.X was a wealthy entrepreneur but the CPA has done no other work.Which of the following statements is TRUE?

A) Assuming the CPA has performed all other necessary and appropriate procedures,he may provide a clean opinion.
B) Assuming the CPA does no further investigation of this matter,the CPA may be considered willfully blind and complicit in an illegal act.
C) The CPA may be associated with misleading information and should withdraw from the audit.
D) The CPA should try to count the cash as it comes in order to avoid issuing a scope limitation report.

Correct Answer:

Verified

Show Answer