During a Review of the Financial Statements of a Nonissuer

question 396

Multiple Choice

During a review of the financial statements of a nonissuer, an accountant becomes aware of a lack of adequate disclosure that is material to the financial statements. If management refuses to correct the financial statement presentations, the accountant should:

• A) Issue an adverse opinion.
• B) Issue an "except for" qualified opinion.
• C) Disclose this departure from generally accepted accounting principles in a separate paragraph of the report.
• D) Express only limited assurance on the financial statement presentations.

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Definitions:

Chi-squared Variables

Random variables that follow a chi-squared distribution, often used in tests of statistical significance for categorical data.

Normal Populations

Refers to populations that follow a bell-shaped distribution curve, indicating a normal distribution of data.

Variance

A measure of variability that indicates the average squared deviation of each number from the mean of a data set, showing how spread out the data points are.

Significance Level

The threshold below which the p-value of test results must fall for the results to be considered statistically significant, typically denoted by alpha (α).