4. In which of the following instances would an auditor most likely issue a standard unqualified opinion WITHOUT an explanatory paragraph? a. Management disclosures are missing or inadequate. b. There is substantial doubt about the entity's ability to continue as a going-concern. c. Due to staffing issues, the audit report was issued later than in previous years. d. There is an material deviation from GAAP related to capitalizing repairs. e. None of the above.

4. In which of the following instances would an auditor most likely issue a standard unqualified opinion WITHOUT an explanatory paragraph? a. Management disclosures are missing or inadequate. b. There is substantial doubt about the entity's ability to continue as a going-concern. c. Due to staffing issues, the audit report was issued later than in previous years. d. There is an material deviation from GAAP related to capitalizing repairs. e. None of the above.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

i need the answer quickly
An auditor has concluded that substantial doubt exists and that the client will not be able to meet its obligations as they become due for a reasonable period of time. Financial statement and footnote disclosures are adequate, detailing the conditions, events, and management's plans to alleviate the doubt. However, the CPA believes that substantial doubt remains. The CPA must add a Going Concern section to the audit report, discussing the Substantial Doubt. How should the audit opinion be modified? a. No modification. b. A qualified opinion. c. An adverse opinion. d. A disclaimer of opinion.
Explain how the circumstances under each of the following might reflect failed leadership by auditors and the audit firm: • Under-reporting of time on an engagement• Premature sign-off on audit procedures• Accepting weak client explanations for accounting
The Auditor prepares a disclaimer of opinion: a. When he cannot find any misstatement in the report. b. When the financial statements are not following GAAP. c. When he finds some discrepancy in the treatment of some items. d. When he is not able to obtain sufficient appropriate audit evidences about an issue.
Which of the following conditions or events would most likely cause an auditor to have substantial doubt about an entity's ability to continue as a going concern? Select one: O a. Significant increase in related-party transactions. O b. Research and development projects are postponed. O c. The CEO, who is key to the company's operations, resigned. O d. All of the options are correct.
19. An auditor conducting an audit in accordance with ______________is responsible for obtaining reasonable assurance that the financial statements taken as a whole are free from material misstatement, whether caused by fraud or error. a. ISAs b. None of the options c. IFRS d. IAS
Which of the following is NOT a reason the auditor performs some substantive procedures at an interim audit date? O increase the effectiveness of the overall audit O client may require it for reporting purposes O allow the audit firm to decrease the amount of work during their 'busy season' O increases the efficiency of the year-end audit
Which of the following would probably not be considered an indication of a material weakness?a. Evidence of a material misstatement.b. Ineffective oversight by the audit committee.c. Immaterial fraud committed by senior management.d. Overproduction by the manufacturing plant.
Negative Assurance in Review Reports. One portion of the report on a review services engagement is the following: “Based on my review, I am not aware of any material modifications that should be made to the accompanying financial statements in order for them to be in conformitywith generally accepted accounting principles [or another framework for financial reporting].”Required:a. Is this paragraph a “negative assurance” given by the accountants?b. Why is negative assurance generally prohibited in audit reports?c. What justification is there for permitting negative assurance in a review services report on unaudited financial statements and on interim financial information?
7. Analytical procedures: A. are not a type of audit evidence. B. are not required during the completion phase of the audit. C. performed during the planning phase of the audit are used as a substantive test in support of account balances. D. do not provide reliable evidence unless it is corroborated with other evidence. 8. Reasonable assurance allows for: A. low likelihood that material misstatements will not be prevented or detected by internal controls. B. no likelihood that material misstatements will not be prevented or detected by internal controls. C. moderate likelihood that material misstatements will not be prevented or detected by internal controls. D. high likelihood that material misstatements will not be prevented or detccted by internal controls. 9. Management implements internal controls to ensure that all required footnote disclosures are accurate. Auditors tests those controls to provide evidence supporting the presentation. A. completeness and valuation B.…
Please do not give image format
DETERMINE WHETHER TRUE OR FALSE S1- Toward the end of an engagement, after all audit evidence has been gathered by the auditor, the auditor again considers materiality by comparing the combined misstatements with the preliminary or revised estimate for the entire set of the financial statements as a whole. S2- Changes in the regulatory or operating environment can result in changes in competitive pressures and significantly different risks.