When Auditors Lack Independence, Which of the Following Is True

question 127

Multiple Choice

When auditors lack independence, which of the following is true about the report on the entity's financial statements that should be issued?

• A)The auditors should disclaim an opinion and should state specifically that they are not independent.
• B)The auditors should disclaim an opinion but not mention that they are not independent.
• C)The auditors should issue an unmodified opinion with an other-matter paragraph stating that they are not independent.
• D)The auditors should issue a qualified opinion with an other-matter paragraph stating that they are not independent.

---

Definitions:

Matter Cycle

The movement and exchange of organic and inorganic matter back into the production of living matter, involving processes like the carbon and nitrogen cycles.

Ecological Pyramid

A graphical representation that shows the biomass or bio productivity at each trophic level in a given ecosystem.

Producer Trophic Level

The first level in a food web, comprised of organisms that produce organic materials (usually through photosynthesis) from inorganic substances.

Base

A substance that can accept hydrogen ions (protons) or more generally, donate a pair of valence electrons; in nucleic acids, a nitrogen-containing molecule that forms part of the genetic code.