An Auditor Was Unable to Obtain an Audited Financial Report

question 54

Multiple Choice

An auditor was unable to obtain an audited financial report or other evidence supporting an entity's investment in a foreign subsidiary considered material to the financial report. Between which of the following opinions
Should the entity's auditor choose?

• A) Qualified and disclaimer.
• B) Qualified and adverse.
• C) Disclaimer and unmodified with an Emphasis of Matter.
• D) Adverse and unmodified with an Emphasis of Matter.

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Definitions:

Allowance Method

A technique in accounting used to adjust accounts receivable for the amount estimated to be uncollectible.

Bad Debts

Accounts receivable that are considered uncollectible, representing losses to the company.

Accounts Receivable Turnover

Accounts Receivable Turnover is a financial metric that measures how efficiently a company collects cash from its credit sales, calculated by dividing total credit sales by the average accounts receivable during a period.

Credit Policies

Guidelines established by businesses to determine to whom they will extend credit and on what terms.