If the Client Refuses to Accept an Audit Report That

question 38

Multiple Choice

If the client refuses to accept an audit report that is qualified due to the known existence of an illegal act, the auditor should:

• A) withdraw from the engagement and indicate the reasons to the audit committee in writing.
• B) issue an adverse opinion if management agrees to fully disclose the matter.
• C) withdraw from the engagement and indicate the reasons to the SEC or other regulatory body in writing.
• D) issue a disclaimer of opinion instead.
• E) issue an unqualified opinion if management agrees to fully disclose the matter.

---

Definitions:

Television Shows

Programs broadcasted on TV intended for entertainment, information, or education.

Violent

Characterized by the use of physical force or aggression to cause harm or damage.

Psychosexual Theory

A theory by Sigmund Freud that proposes human development is driven by the libido as it shifts between different body zones at different stages of early life.

4-Year-Old

Describes a child typically in the early childhood period, showing rapid development in language, cognition, and social skills.