CPA Auditing and Attestation

CPA Auditing and Attestation practice questions, page 12 of 41, with answer review and explanations.

Question 56

Under which of the following circumstances would a disclaimer of opinion not be appropriate?

  1. The financial statements fail to contain adequate disclosure of related party transactions.
  2. The client refuses to permit its attorney to furnish information requested in a letter of audit inquiry.
  3. The auditor is engaged after fiscal year-end and is unable to observe physical inventories or apply alternative procedures to verify their balances.
  4. The auditor is unable to determine the amounts associated with illegal acts committed by the client's management.

Question 57

Green, CPA, concludes that there is substantial doubt about JKL Co.'s ability to continue as a going concern. If JKL's financial statements adequately disclose its financial difficulties, Green's auditor's report should:

  1. Option A
  2. Option B
  3. Option C
  4. Option D

Question 58

An auditor may reasonably issue an "except for" qualified opinion for a(an):

  1. Option A
  2. Option B
  3. Option C
  4. Option D C

Question 59

The following explanatory paragraph was included in an auditor's report to indicate a lack of consistency: "As discussed in note T to the financial statements, the company changed its method of computing depreciation in X0." How should the auditor report on this matter if the auditor concurred with the change? Type of Location of opinion explanatory paragraph

  1. Unqualified Before opinion paragraph
  2. Unqualified After opinion paragraph
  3. Qualified Before opinion paragraph
  4. Qualified After opinion paragraph

Question 60

How does an auditor make the following representations when issuing the standard auditor's report on comparative financial statements?

  1. Option A
  2. Option B
  3. Option C
  4. Option D