A Nonpublic Client Has Provided Required Supplementary Information with Its

question 50

Multiple Choice

A nonpublic client has provided required supplementary information with its audited financial statements. The auditor's proper reporting responsibility includes:

• A) An emphasis-of-matter paragraph should be added to the audit report.
• B) A separate report should be issued on the required supplementary information.
• C) An adverse opinion on the required supplementary information.
• D) The required supplementary information should not be referred to.

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Definitions:

Residual Value

is the estimated amount that an entity would currently obtain from disposing of the asset, after deducting the estimated costs of disposal, at the end of its useful life.

Asset's Economic Life

The period over which an asset is expected to be economically useful to the owner.

Inception Date

The date on which an agreement, policy, or financial instrument becomes effective or is entered into.

Fair Value

A projected price for an asset or liability that could be transferred between agreeable, well-informed participants in a transaction that is free from any special relationship.