If Management Fails to Provide Adequate Justification for a Change

question 61

Multiple Choice

If management fails to provide adequate justification for a change from one generally accepted accounting principle to another,the auditors should

• A)Add an additional paragraph and express a qualified or an adverse opinion on the entity's financial statements for lack of conformity with generally accepted accounting principles.
• B)Disclaim an opinion on the entity's financial statements because of uncertainty.
• C)Disclose the matter in an additional paragraph but not modify the opinion paragraph on the entity's financial statements.
• D)Neither modify the opinion on the entity's financial statements nor disclose the matter because both principles are generally accepted accounting principles.

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Definitions:

Charophyte Algae

A group of green algae thought to be the closest relatives of land plants, sharing common traits such as cellular division and photosynthetic pigments.

Closest Relatives

The species or taxonomic group that is most closely related to another in evolutionary terms, sharing a recent common ancestor.

Land Plants

Plants that have evolved to live primarily on land, as opposed to aquatic environments, featuring adaptations such as roots and protective tissues.

Plasmodium

A genus of unicellular protists that are parasites, causing malaria in humans and other animals.