Show This preview shows page 10 - 12 out of 15 pages. 114.When an auditor expresses an adverseopinion he/she should disclose the substantivereasons for such an opinion in an explanatoryparagraph. Environmental performance reportb.Annual reportc.Environmental riskd.Special purpose audit report115.It exists when other information, notrelated to matters appearing in the auditedfinancial statements, is incorrectly stated orpresented.116.It exists when other information contradictsinformation contained in the audited financialstatements.117.When audited financial statements arepresented in a client’s document containingother information, the auditor shoulda.Perform inquiry and analytical proceduresto ascertain whether the other informationis reasonable.b.Add an explanatory paragraph to theauditor’s report without changing theopinion on the financial statements.c.Perform the appropriate substantiveauditing procedures to corroborate theother information.d.Read the other information to determinethat it is consistent with the auditedfinancial statements.118.If an amendment to other information in adocumentcontainingauditedfinancialstatements is necessary and the entity refusesto make the amendment, the auditor wouldconsider issuing:119.They are not presented as completefinancial statements capable of standing alone,but are an integral part of the current period.a.Corresponding figuresb.Comparative financial statementsc.Supplementary reportd.Notes of financial statementsOther Audit Special Considerations andReports120.A report, separate from the financialstatements, in which an entity provides thirdparties with qualitative information on theentity'scommitmentstowardstheenvironmental aspects of the business, itspolicies and targets in that field, itsachievement in managing the relationshipbetweenitsbusinessprocessesandenvironmentalrisk,andquantitativeinformation on its environmental performance.a.Environmental performance reportb.Annual reportc.Environmental riskd.Special purpose audit report 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 15 pages? Upload your study docs or become a Course Hero member to access this document Professor DarrelJoeAsuncion When an auditor expresses an adverse opinion the opinion?8. The auditor shall express an adverse opinion when the auditor, having obtained sufficient appropriate audit evidence, concludes that misstatements, individually or in the aggregate, are both material and pervasive to the financial statements.
What happens if an auditor issues an adverse opinion?An adverse opinion can seriously damage a company's reputation, plummet their stock price, or result in a delisting from trading exchanges. Accountants who deviate from GAAP, or the generally accepted accounting principles, should expect that at some point they will be looked at more closely.
Why would an auditor include an explanatory paragraph in an audit report?The auditor should include an explanatory paragraph in an unmodified opinion audit report when the audit is completed with satisfactory results and the financial statements are fairly presented, but the auditor believes it is important to draw the reader's attention to certain matters or the auditor is required to ...
Which of the following occurs when an adverse opinion is expressed on the financial statements?A misstatement is material and pervasive. Which of the following occurs when an adverse opinion is expressed on the financial statements? The auditor's responsibility section changes.
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When an auditor expresses an adverse opinion he she should disclose the substantive reasons for such an opinion in an explanatory paragraph?
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