If a Material Misstatement Is Discovered in Previous Periods Financial

question 31

Multiple Choice

If a material misstatement is discovered in previous periods financial statements on which the auditor previously expressed an unqualified opinion and the previous statements are not revised, but the comparatives have been properly accounted for and disclosed in accordance with an identified financial reporting framework in the current years statements, then the auditor should express what sort of opinion?

• A) disclaimer of opinion.
• B) adverse opinion.
• C) unqualified opinion
• D) qualified opinion.

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Definitions:

Cost Behaviour

The manner in which a cost changes as the related activity level changes, classified into fixed, variable, and mixed costs.

Cost Report

A detailed financial document that outlines the actual costs incurred during a project or for business operations over a defined period, often used for tracking and controlling expenditures.

Relevant Range

The range of activity within which the assumptions about fixed and variable cost behaviors are valid.

Car Washing Labour Cost

The expenses associated with labor that are incurred during the process of washing cars.