Which of the Following Is True Regarding the Auditor's Responsibility

question 6

Multiple Choice

Which of the following is true regarding the auditor's responsibility to report on information accompanying the basic financial statements in a client-prepared document?

• A) The auditor may report on information accompanying the basic financial statements in a client prepared document only if he or she has been specifically engaged to do so.
• B) The auditor is required to express an opinion on whether information accompanying the basic financial statements in a client-prepared document is fairly stated in all material respects in relation to the financial statements taken as a whole.
• C) If an auditor chooses to report on information accompanying the basic financial statements in a client prepared document, the report should include a description of the character of the audit work performed.
• D) If an auditor chooses to report on information accompanying the basic financial statements in a client prepared document, the report should include an opinion on the information but should not describe the character of the audit work performed.

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Definitions:

Sharing Profits

The distribution of a portion of a company's earnings to stakeholders, such as employees or partners.

Limited Partnership

A business structure where at least one partner has limited liability to the extent of their investment, while at least one other has unlimited liability.

Organizational Records

Documents and records that are important for maintaining the operations, legal compliance, and historical record of an organization.

Financial Records

Documents that track and provide evidence of a person's, company's, or entity's financial transactions and condition.