Which of the Following Is a Reason for an Auditor

question 28

Multiple Choice

Which of the following is a reason for an auditor to issue a qualified opinion?

• A)Difference of opinion with management on presentation of financial statements in the annual report
• B)Difference of opinion with management on earnings estimate of a material amount
• C)Difference of opinion with management on preferred accounting principles under GAAP
• D)Difference of opinion with management on a material application of accounting standards

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Definitions:

Unit of Measure Concept

An accounting principle that states all business transactions must be recorded in a single, consistent unit of measurement.

Financial Statements

Comprehensive reports that provide insights into a company's financial health, including balance sheets, income statements, and cash flow statements.

Manufacturing Companies

Businesses that produce finished goods from raw materials through the use of labor, machines, tools, and chemical or biological processing.

Cost Concept

An accounting principle that dictates that all assets are recorded and reported at their original purchase cost rather than their current market value.