3. Emily, CPA, was engaged to review the unaudited. financial statements of Rooster Restaurants Inc., anonpublic company. During her review, Emily foundthat Rooster had not capitalized leases as required byGAAP. The result was so material, that Emily modifiedthe standard review report to state that "the financialstatements are not in conformity with GAAP."Is Emily's report in accordance with professionalstandards? If not, what should she have done underthe circumstances? Explain

Unaudited financial statements are those statements which has not been audited by the auditor and…

Answered: Is Emily's report in accordance with…

Is Emily's report in accordance with professional standards? If not, what should she have done under the circumstances? Explain

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Question

3. Emily, CPA, was engaged to review the unaudited
. financial statements of Rooster Restaurants Inc., a
nonpublic company. During her review, Emily found
that Rooster had not capitalized leases as required by
GAAP. The result was so material, that Emily modified
the standard review report to state that "the financial
statements are not in conformity with GAAP."
Is Emily's report in accordance with professional
standards? If not, what should she have done under
the circumstances? Explain

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