Audit Practice Exam - Other Reports | Take the Quiz

An auditor's report would be designated a special report when it is issued in connection with:

Limited use prospective fincancial statements such as financial projection

Interim financial information of a publicly held company that is subject to a limited review

Compliance with aspects of reggulatory requirements related to audited financial statements

Application of accounting principles to specified transactions

An auditor's report on financial statements prepared in accordance with other comprehensive basis of accounting should include all of the following EXCEPT:

An opinion as to whether the basis of accounting used is appropriate under the circumstances

An opinion as to whether the financial statements are presented fairly in conformity with the other comprehensive basis of accountingg

Referencing to the the note to the financial statements that describes the basis of presentation

A statement that the basis of presentation is a comprehensive basis of accounting other than GAAP

Accepting an engagement to examine an entity's financial projection would be appropriate if it was distributed to:

A bank with which the entity is negotiating a loan

All employees of the company

Potential stockholders who request a statement

All stockholders

Which of the followingg procedures is more likely to be performed in a review engagement of a nonpublic entity than in a compilation?

Gaining an understandingg of the entitys business transactions

Making a preliminary assessment of control risk

Obtaining a representation letter from the CEO

Assisting the entity in adjusting the accounting records

An accountant should perform analytical procedures during an engagement to:

REVIEW a nonpublic entity's F/S

REVIEW AND COMPILE a nonpublic entity's F/S

COMPILE a nonpublic entity's F/S

Neither REVIEW nor COMPILE a nonpublic entity's F/S

During a review of the financial statements of a nonpublic entity, an accountant becomes aware of a lack of adequate disclosure that is material to the financial statement. If management refuses to correct the financial statement presentations, the accountant should:

Issue an "except for" qualified opinion

Issue an adverse opinion

Express only limited assurance on the financial statement presentations

Disclose this departure from GAAP in a separate paragraph of the report

Each page of the financial statements compiled by an accountant should include a reference such as:

See accompanying accountant's footnotes

See accountant's compilation report

Unaudited, see accountant's disclaimer

Subject to compilation restrictions

An accountant who had begun an audit of the financial statements of a nonpublic entity was asked to chnge the engagement to a review because of a resctriction on the scope of the audit. If there is reasonable justification for the change, the accountant's report should include reference to the:

Original engagement agreed to; and the scope limitation that caused the change

Justthe scope limitation that caused the change

Just the original engagement agreed to

NEITHER original engagement agreed to NOR the scope limitation that caused the change

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