Your Client Has Two Sets of Financial Statements

question 37

Multiple Choice

Your client has two sets of financial statements. One set is in compliance with IFRS, while the other set is in compliance with local tax legislation and will be used only with the tax returns. How do these events affect the independent auditor's report?

• A) The auditor would use an unqualified audit report for both financial statements, with an emphasis of matter paragraph that describes to readers the nature of the other set of financial statements.
• B) The auditor would use a standard unqualified auditor's report for both financial statements, labeling the auditor's report "for IFRS only" and "for tax purposes only."
• C) The auditor would use an unqualified audit report for both financial statements, with an other matter paragraph that describes to readers the nature of the other set of financial statements.
• D) The auditor would use a qualified audit report, as the client may not have two different sets of financial statements.

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Definitions:

Affective Computing

An area of research in computer science aiming to develop systems and devices that can recognize, interpret, process, and simulate human emotions.

Collaborative Consumption

The practice of sharing, swapping, bartering, or renting access to products and services, rather than owning them, typically facilitated by community-based online platforms.

Unsupervised Learning

A type of machine learning algorithm used to draw inferences and find patterns in datasets without pre-existing labels.

System

A set of interacting or interdependent components forming an integrated whole or a method or set of procedures for achieving something.