Independent Auditors Must Consider Whether the Entity Has the Ability

question 68

Multiple Choice

Independent auditors must consider whether the entity has the ability to continue as a going concern. If a substantial doubt exists but disclosure is adequate and no other basis exists for modifying the report, the auditors would normally

• A)disclaim an opinion.
• B)express an adverse opinion.
• C)qualify the opinion.
• D)express an unqualified opinion with an explanatory paragraph describing the going-concern uncertainty.

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Definitions:

Percent Change

A measure that denotes the degree of change over time, calculated by subtracting the original value from the new value, then dividing by the original value and multiplying by 100 to get a percentage.

Percent More

A relative increase from one value to another expressed as a percentage.

Initial Value

The starting value of a financial variable before any changes, such as interest or depreciation, are applied.

Percent Change

The measure of how much a quantity grows or shrinks compared to its previous value, often expressed as a percentage.