The Auditor Issues an Adverse Opinion When

question 80

Multiple Choice

The auditor issues an adverse opinion when

• A)the auditor has sufficient appropriate audit evidence and concludes that the misstatements to the financial statements are material,but not pervasive
• B)the auditor is unable to obtain sufficient appropriate evidence,but the auditor concludes that the possible effects of the misstatement could be both material and pervasive
• C)the auditor is unable to obtain sufficient appropriate evidence,but the auditor concludes that the possible effects of the misstatement could be material,but not pervasive
• D)the auditor has reasonable evidence to determine that the financial statements are not free from material misstatement
• E)the auditor has sufficient evidence to determine that the financial statements are not free from material misstatement

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Definitions:

Divisor

A number by which another number, typically the numerator of a fraction, is divided.

Bankruptcy

The legal status for individuals or entities that cannot repay debts owed to creditors, often involving asset liquidation.

Original Investment

The initial amount of money put into an investment or project, before any earnings, interest, or growth.

Common Shareholders

Individuals or entities that own common shares in a company, giving them rights to vote at shareholders' meetings and to receive dividends.