In Which of the Following Circumstances Would an Auditor Most

question 150

Multiple Choice

In which of the following circumstances would an auditor most likely express an adverse opinion?

• A) The CEO refuses to let the auditor have access to the board of director meeting minutes.
• B) The financial statements are not in conformity with the FASB statement on loss contingencies.
• C) Information comes to the auditor's attention that raises substantial doubt about the ability for the client to continue as a going concern.
• D) Tests of controls show that the internal control structure is so poor that the auditor has to assess control risk at the maximum.

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Definitions:

Transfer Payment

Payments made by governments to individuals or other entities without the government receiving any goods or services in return, such as welfare payments or subsidies.

Social Security Recipients

Individuals who receive benefits from the Social Security Administration, typically due to retirement, disability, or survivorship.

Government Expenditures

The total amount spent by the government on goods, services, and public projects.

State and Local Governments

Governmental authorities below the national level, responsible for local administration and governance within their respective areas.