Morris Ltd Changed from the Straight-Line Method to the Declining

question 43

Multiple Choice

Morris Ltd changed from the straight-line method to the declining balance method of depreciation for all newly acquired assets. This change has no material effect on the current year's financial statements but is reasonably
Certain to have a substantial effect in later years. If the change is adequately disclosed in the notes to the financial
Statements, the auditor should issue a report with a(n) :

• A) consistency modification.
• B) unmodified opinion.
• C) explanatory paragraph.
• D) qualified opinion.

---

Definitions:

Specific Hypothesis

A precise statement or prediction about the relationship between two or more variables that can be tested.

Analytic Comparisons

Comparisons made using systematic logical reasoning to explore differences or similarities between datasets or variables.

Unplanned Comparisons

Comparisons not been built into a research design prior to data collection.

F Ratio

A statistic used in ANOVA tests to compare variance across groups, assessing if the differences between means are significant.