Show
This preview shows page 1 - 2 out of 3 pages. In which of the following situations would an auditor ordinarily issue an unqualified/unmodified financialstatement audit opinion with no explanatory (or emphasis-of-matter/other-matter) paragraph?a.The auditor wishes to emphasize that the entity had significant related-party transactions.b.The auditor decides to refer to the report of another auditor as a basis, in part, for the auditor'sopinion.c.The entity issues financial statements that present financial position and results of operations butomits the statement of cash flows.d.The auditor has substantial doubt about the entity's ability to continue as a going concern, but thecircumstances are fully disclosed in the financial statements. A public entity changed from the straight-line method to the declining balance method of depreciation forall newly acquired assets. This change has no material effect on the current year's financial statements Upload your study docs or become a Course Hero member to access this document Upload your study docs or become a Course Hero member to access this document End of preview. Want to read all 3 pages? Upload your study docs or become a Course Hero member to access this document In which of the following situations would an auditor ordinarily issue an unqualified audit opinion without an explanatory paragraph? SAS No. 33 The Auditor's Report on Financial Statements StatusRevised by Auditing Standards Committee in Taiwan on 21 December, 1999. SummaryThe auditor should review and assess the conclusions drawn from the audit evidence obtained as the basis for the expression of an opinion on the financial statements. The auditor’s report should contain a clear written expression of opinion on the financial statements taken as a whole. The auditor’s report includes the following basic elements, ordinarily in the following layout:
The auditor’s report should have an appropriate title to distinguish the auditor’s report from reports that might be issued by others. Introductory Paragraph The auditor’s report should identify the financial statements of the entity that have been audited, including the date of and period covered by the financial statements. The report should include a statement that the financial statements are the responsibility of the entity’s management and a statement that the responsibility of the auditor is to express an opinion on the financial statements based on the audit. Scope Paragraph The auditor’s report should describe the scope of the audit by stating that the audit was conducted in accordance with generally accepted auditing standards or in accordance with relevant national standards or practices as appropriate. The report should include a statement that the audit was planned and performed to obtain reasonable assurance about whether the financial statements are free of material misstatement.The auditor’s report should describe the audit as including:
The report should include a statement by the auditor that the audit provides a reasonable basis for the opinion. Opinion Paragraph The opinion paragraph of the auditor’s report should clearly state the auditor’s opinion as to whether the financial statements are presented fairly, in all material respects, in accordance with generally accepted accounting principles and, where appropriate, whether the financial statements comply with statutory requirements. Date of Report The auditor should date the report as of the completion date of the audit. The Auditor’s Reports Unqualified Report Modified Reports Matters that Do Not Affect the Auditor’s Opinion Certain circumstances, while not affecting the auditor’s unqualified opinion, may require that the auditor add an explanatory paragraph (or other explanatory language) to the standard report. These circumstances include:The auditor’s opinion is based in part on the report of another auditor.
Matters that Do Affect the Auditor’s Opinion An auditor may not be able to express an unqualified opinion when either of the following circumstances exists and, in the auditor’s judgment, the effect of the matter is or may be material to the financial statements:
The circumstances described in (a) could lead to a qualified opinion or a disclaimer of opinion. The circumstances described in (b) could lead to a qualified opinion or an adverse opinion. Qualified Opinion Disclaimer of Opinion Adverse Opinion Whenever the auditor expresses an opinion that is other than unqualified, a clear description of all the substantive reasons should be included in the report and, unless impracticable, a quantification of the possible effect(s) on the financial statements. This information would be set out in a separate paragraph preceding the opinion or disclaimer of opinion on the financial statements and may include a reference to a more extensive discussion, if any, in a note to the financial statements. Effective dateThis Statement is effective from 31 December, 1999. In which of the following situations would an auditor ordinarily issue an unqualified unmodified financial statement audit opinion with no explanatory paragraph?An auditor would generally issue an unqualified audit opinion without an explanatory paragraph when the auditor decides to make reference to the report of another auditor as a basis, in part, for the auditor's opinion.
In which of the following situations would an auditor ordinarily issue an unmodified audit opinion?An auditor would generally issue an unmodified audit opinion without an emphasis-of-matter paragraph when the auditor decides to make reference to the audit of a component auditor as a basis, in part, for the auditor's opinion.
Which of the following situations would an auditor ordinarily choose between expressing an Except for qualified opinion or an adverse opinion?In which of the following situations would an auditor ordinarily choose between expressing an "except for" qualified opinion and expressing an adverse opinion? The financial statements fail to disclose information that is required by generally accepted accounting principles.
In which situations would an auditor issue a qualified opinion on a company's financial statements?A qualified opinion is often given when the business being audited did not follow the generally accepted accounting principles (GAAP) when preparing their financial statement.
|