Pell, CPA, Decides to Serve as Principal Auditor in the Audit

question 984

Multiple Choice

Pell, CPA, decides to serve as principal auditor in the audit of the financial statements of Tech Consolidated, Inc. Smith, CPA, audits one of Tech's subsidiaries. In which situation(s) should Pell make reference to Smith's audit?

• A) Pell reviews Smith's audit documentation and assumes responsibility for Smith's work, but expresses a qualified opinion on Tech's financial statements. II. Pell is unable to review Smith's audit documentation; however, Pell's inquiries indicate that Smith has an excellent reputation for professional competence and integrity.
• B) I only.
• C) II only.
• D) Both I and II.
• E) Neither I nor II.

---

Definitions:

Distinguish Among Colors

The ability to perceive and identify differences in colors by the visual system.

Reflexive Behavior

Automatic responses or actions triggered without conscious thought, typically as a physiological reaction to stimuli.

Neurological Deficit

A measurable impairment in the functioning of the nervous system, affecting sensory and motor abilities.

Paid Maternity Leave

Employment benefit that provides pay to women during a period of absence from work in the weeks before and after childbirth.