After Considering Management's Plans, an Auditor Concludes That There Is

question 64

Multiple Choice

After considering management's plans, an auditor concludes that there is substantial doubt about a client's ability to continue as a going concern for a reasonable period of time. The auditor's responsibility includes

• A)disclaiming an opinion on the financial statements due to the indications of possible financial difficulties.
• B)indicating to the client's audit committee whether management's plans for dealing with the adverse effects of the financial difficulties can be effectively implemented.
• C)considering the adequacy of disclosure about the client's possible inability to continue as a going concern.
• D)issuing a qualified or adverse opinion, depending upon materiality, due to the possible effects on the financial statements.

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Definitions:

Government

The system or group of people governing an organized community, often a state, including institutions and officials with authority to make and enforce laws.

Prosecutes

The act or process of conducting a legal action against someone in a court of law for a criminal offense.

Public Figure

An individual who has gained prominence in the public sphere or is in a position that attracts public attention.

Defamation

The act of damaging someone's reputation through false or malicious statements.