When Reporting on Comparative Financial Statements Where the Financial Statements

question 72

Multiple Choice

When reporting on comparative financial statements where the financial statements of the prior year have been examined by a predecessor auditor whose report is not presented, the successor auditor should make

• A) No reference to the predecessor auditor.
• B) Reference to the predecessor auditor only if the predecessor auditor expressed a qualified opinion.
• C) Reference to the predecessor auditor only if the predecessor auditor expressed an unqualified/unmodified opinion.
• D) Reference to the predecessor auditor regardless of the type of opinion expressed by the predecessor auditor.

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Definitions:

Reducing Groupthink

Strategies and measures aimed at preventing the occurrence of groupthink, a phenomenon where the desire for harmony in a decision-making group overrides a realistic appraisal of alternatives.

Effective Decision-Making Strategies

Approaches and techniques that enhance the quality and outcomes of decisions, taking into account various factors and potential impacts.

Shared Information Bias

The tendency for group members to spend more time and emphasis discussing information that all members are already familiar with, rather than focusing on unshared, unique information.

Self-Censorship

The act of censoring or withholding one's opinions, feelings, or concerns, especially in a group setting, due to anticipated negative response or judgement from others.