AUD practice questions, page 13 of 41, with answer review and explanations.
Question 61
In which of the following situations would an auditor ordinarily issue an unqualified audit opinion without an explanatory paragraph?
The auditor wishes to emphasize that the entity had significant related party transactions.
The auditor decides to make reference to the report of another auditor as a basis, in part, for the auditor's opinion.
The entity issues financial statements that present financial position and results of operations, but omits the statement of cash flows.
The auditor has substantial doubt about the entity's ability to continue as a going concern, but the circumstances are fully disclosed in the financial statements.
Question 62
When there has been a change in accounting principle that materially affects the comparability of the comparative financial statements presented and the auditor concurs with the change, the auditor should:
Option A
Option B
Option C
Option D
Question 63
When a qualified opinion results from a limitation on the scope of the audit, the situation should be described in an explanatory paragraph:
Preceding the opinion paragraph and referred to only in the scope paragraph of the auditor's report.
Following the opinion paragraph and referred to in both the scope and opinion paragraphs of the auditor's report.
Following the opinion paragraph and referred to only in the scope paragraph of the auditor's report.
Preceding the opinion paragraph and referred to in both the scope and opinion paragraphs of the auditor's report.
Question 64
Restrictions imposed by a client prohibit the observation of physical inventories, which account for 35% of all assets. Alternative audit procedures cannot be applied, although the auditor was able to examine satisfactory evidence for all other items in the financial statements. The auditor should issue a(an):
"Except for" qualified opinion.
Disclaimer of opinion.
Unqualified opinion with a separate explanatory paragraph.
Unqualified opinion with an Explanation: in the scope paragraph.
Question 65
An auditor concludes that there is substantial doubt about an entity's ability to continue as a going concern for a reasonable period of time. If the entity's disclosures concerning this matter are adequate, the audit report may include a(an):