If the Auditors Obtains Sufficient Appropriate Evidence on the Entity's

question 165

Multiple Choice

If the auditors obtains sufficient appropriate evidence on the entity's accounts receivable balance by alternative procedures because it is impracticable to confirm accounts receivable, the opinion on the entity's financial statements should be unmodified and would

• A)disclose the fact that alternative procedures were used due to client-imposed scope limitation.
• B)disclose in the Basis for Opinion Section that confirmation of accounts receivable was impracticable.
• C)not mention the alternative procedures.
• D)include an other-matter paragraph that discloses the performance of alternative procedures.

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Definitions:

Bilateral Contract

A type of contract involving mutual obligations whereby each party promises to perform an act in exchange for the other party's act.

Promissory Estoppel

A legal principle that prevents a party from withdrawing a promise made to a second party if the latter has reasonably relied on that promise to their detriment.

Adequacy of Consideration

Assessing whether something of legal value has been exchanged in a contract to justify the parties’ obligations.

Consideration

In contract law, it refers to something of value, such as money, services, or goods, exchanged between parties as part of an agreement.