If an Entity's External Auditor Expresses an Unmodified Opinion as a Result

question 7

Multiple Choice

If an entity's external auditor expresses an unmodified opinion as a result of the audit of the entity's financial report, readers of the auditor's report can assume that:

• A)the entity is financially sound and the financial report is accurate.
• B)the external auditor found no irregularities.
• C)all material disagreements between the entity and the external auditor about the application of accounting principles were resolved to the satisfaction of the auditor.
• D)the internal control structure is effective.

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Definitions:

Typist's Initials

The initials used by a typist as a form of identifying or signing off on documents they have prepared or worked on.

Inside Address

The name and address of the person to whom the letter is being sent. It appears on a business letter two to four spaces down from the date. It should be two, three, or four lines in length.

Business Letter

A formal document used for communication between companies, or between a company and an individual, characterized by a structured layout and professional tone.

Transparent Window

A clear section of material that allows light to pass through, making objects or environments on the opposite side visible.