Which of the Following Is Not an Appropriate Reporting Option

question 90

Multiple Choice

Which of the following is not an appropriate reporting option when component auditors are involved in the audit of group financial statements, assuming that the component auditors' work did not identify any issues affecting the group auditors' report?

• A)Issue a standard (unmodified)report that does not reference any involvement by the component auditors.
• B)Identify the component auditors by name and present their report along with the group auditors' report.
• C)Refer to the component auditors' work and disclose the extent of their work in the group auditors' report.
• D)Disclaim an opinion on the portion of the financial statements examined by the component auditors.

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Definitions:

Budgeted Raw Material Purchases

The estimated amount a company plans to spend on raw materials for production over a specific period.

Estimated Direct Labor Cost

The projected cost of labor directly involved in the manufacturing of goods or provision of services, excluding indirect labor costs.

Expected Cash Collections

Projected amounts of money a business anticipates receiving from its customers or clients over a specific period.

Estimated Direct Labor Cost

The anticipated cost of labor directly associated with the production of goods or services, typically estimated before production begins.