In Which of the Following Circumstances May the Auditor Issue

question 16

Multiple Choice

In which of the following circumstances may the auditor issue the standard unqualified,unmodified audit report?

• A)The client disclosed a change in accounting principles with an immaterial effect on financial position and results of operations.
• B)The financial statements do not disclose significant going concern issues.
• C)The financial statements do not disclose a justified departure from generally accepted accounting principles.
• D)The auditor has not been able to audit a substantial portion of the balance sheet because of circumstances beyond anyone's control.

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Definitions:

Enforceable

A term that describes a legal agreement or contract that can be upheld and compelled by the law.

Illegal

Activities or actions that are forbidden by law and punishable by fines, penalties, or imprisonment.

Restrictive Covenant

A clause in a contract or deed limiting what the owner of the property can do with it.

Injunction

A court order requiring an individual or entity to do or cease doing a specific action.