The Auditors Have Determined That There Is Substantial Doubt About

question 40

Multiple Choice

The auditors have determined that there is substantial doubt about an entity's ability to continue as a going concern. When considering the appropriateness of management's disclosures and severity of the uncertainty, all of the following reports could be issued, except

• A)qualified opinion based on a material and pervasive uncertainty.
• B)unmodified opinion with an additional section describing the uncertainty.
• C)adverse opinion based on inadequate disclosure of the uncertainty.
• D)disclaimer of opinion based on a material and pervasive uncertainty.

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Definitions:

Means Test

A method used to determine an individual's eligibility for certain types of financial assistance or legal aid, based on their income and assets.

Chapter 7

A provision under the U.S. Bankruptcy Code dealing with liquidation, where a debtor's non-exempt assets are sold and the proceeds distributed to creditors.

Chapter 13

A section of the United States Bankruptcy Code that allows individuals with a regular income to create a plan to repay all or part of their debts.

Bankruptcy Estate

In bankruptcy proceedings, all of the debtor’s interests in property currently held and wherever located, as well as interests in certain property to which the debtor becomes entitled within 180 days after filing for bankruptcy.