Under Which of the Following Circumstances Would a Disclaimer of Opinion

question 14

Multiple Choice

Under which of the following circumstances would a disclaimer of opinion on the entity's financial statements not be appropriate?

• A)The financial statements fail to contain adequate disclosure of related-party transactions.
• B)The entity refuses to permit its attorney to furnish information requested in an attorney letter.
• C)The auditors are engaged after the date of the financial statements and are unable to observe physical inventories or apply alternative procedures to verify their balances.
• D)The auditors are unable to determine the amounts associated with illegal acts committed by the entity's management.

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Definitions:

Unconscious Thoughts

Mental processes occurring without conscious awareness, influencing behaviors, decisions, and emotions in hidden ways.

Objective Criteria

Standards or benchmarks that are not influenced by personal feelings or opinions and can be measured or evaluated by others independently.

Interjudge Agreement

Interjudge agreement refers to the level of consistency among different judges or observers in their assessments or ratings of a specific phenomenon.

Reaction Formation

A defense mechanism where an individual unconsciously replaces an undesirable or anxiety-inducing emotion or desire with its exact opposite.