Your Client Has Two Sets of Financial Statements

question 7

Multiple Choice

Your client has two sets of financial statements.One set is in compliance with IFRS,while the other set is in compliance with local tax legislation and will be used only with the tax returns.How do these events affect the independent auditor's report?

• A)The auditor would issue an unmodified audit report for both financial statements,with an Emphasis of Matter paragraph that describes to readers the nature of the other set of financial statements.
• B)The auditor would issue an unmodified auditor's report for both financial statements,labeling the auditor's report "for IFRS only" and "for tax purposes only."
• C)The auditor would issue an unmodified audit report for both financial statements,with an Other Matter paragraph that describes to readers the nature of the other set of financial statements.
• D)The auditor would issue a modified audit report,as the client is not allowed to have two different sets of financial statements.

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Definitions:

Farm Output

The total quantity of agricultural products produced by a farm.

Parity Ratio

A term not defined in standard economic texts, potentially referring to comparative measures of commodities, incomes, or other economic indicators, effectively requiring further context for accurate explanation.

Farm Subsidies

Financial support and assistance provided by the government to farmers and agribusinesses to supplement their income and manage the supply of agricultural commodities.

American Institution

Organizations, principles, or traditions that are foundational to the society and culture of the United States.