6) Which of the following is least likely to cause uncertainty about the ability of an entity to continue as a going concern?
A) The entity is suing a competitor for a minor patent infringement.
B) The entity has lost a major customer.
C) The entity has significant recurring operating losses.
D) The entity has working capital deficiencies.
7) When there is uncertainty about a company’s ability to continue as a going concern, the auditor’s concern is the possibility that the client may not be able to continue its operations or meet its obligations for a “reasonable period of time.” For this purpose, a reasonable period of time is considered not to exceed:
A) six months from the date of the financial statements.
B) one year from the date of the financial statements.
C) six months from the date of the audit report.
D) one year from the date of the audit report.
8) When the auditor concludes that there is substantial doubt about the entity’s ability to continue as a going concern, the appropriate audit report could be:
I.an unqualified opinion with an explanatory paragraph.
II.a disclaimer of opinion.
A) I only
B) II only
C) I or II
D) Neither I nor II
9) When a company’s financial statements contain a departure from GAAP with which the auditor concurs, the departure should be explained in:
A) the scope paragraph.
B) an explanatory paragraph that appears before the opinion paragraph.
C) the opinion paragraph.
D) an explanatory paragraph after the opinion paragraph.
10) William Gregory, CPA, is the principal auditor for a multi-national corporation. Another CPA has examined and reported on the financial statements of a significant subsidiary of the corporation. Gregory is satisfied with the independence and professional reputation of the other auditor, as well as the quality of the other auditor’s examination. With respect to his report on the consolidated financial statements, taken as a whole, Gregory:
A) must not refer to the examination of the other auditor.
B) must refer to the examination of the other auditor.
C) may refer to the examination of the other auditor.
D) must refer to the examination of the other auditors along with the percentage off consolidated assets and revenue that they audited.
11) A company has changed its method of inventory valuation from an unacceptable one to one in conformity with generally accepted accounting principles. The auditor’s report on the financial statements of the year of the change should include:
A) no reference to consistency.
B) a reference to a prior period adjustment in the opinion paragraph.
C) an explanatory paragraph that justifies the change and explains the impact of the change on reported net income.
D) an explanatory paragraph explaining the change.
12) Which of the following modifications of the auditor’s report does not include an explanatory paragraph?
A) A qualified report is due to a GAAP departure.
B) The report includes an emphasis of a matter.
C) There is a very material scope limitation.
D) A principal auditor accepts the work of an other auditor.
13) No reference is made in the auditor’s report to other auditors who perform a portion of the audit when:
I.The other auditor audited an immaterial portion of the audit.
II.The other auditor is well known or closely supervised by the principle auditor.
III.The principle auditor has thoroughly reviewed the work of the other auditor.
A) I and II
B) I and III
C) II and III
D) I, II and III
14) When an auditor is trying to determine how changes can affect consistency and and/or comparability, he should keep in mind that:
A) changes that affect comparability but not consistency require an explanatory paragraph.
B) items that materially affect the comparability of financial statements requires a disclaimer of opinion.
C) changes that affect consistency require an explanatory paragraph if they are material.
D) changes that involve either comparability or consistency only need to be mentioned in the footnotes.
15) All of the following would require an emphasis of matter paragraph except for:
A) the existence of material related party transactions.
B) the lack of auditor independence.
C) important events occurring subsequent to the balance sheet date.
D) material uncertainties disclosed in the footnotes.
GraduateWriterHelp.com is an online academic writing platform that provides extensive assistance to graduate school students as they work through their research projects, papers and dissertations. GraduateWriterHelp.com gives students access to experienced professionals who can provide the help they need in a timely and efficient manner. The service offers a wide range of services, including editing, proofreading, formatting, researching and more that can give students the confidence they need to write the perfect paper or dissertation for their chosen subject matter.
Services Offered by GraduateWriterHelp.com
GraduateWriterHelp.com offers a wealth of different services designed to make research projects easier for graduate school students. These include editing, proofreading, formatting and researching services, all tailored specifically for graduate-level studies such as PhDs or Master’s degrees in any field from business administration to engineering or even psychology – all with the aim of helping busy students find success in their academics without having to sacrifice other important commitments like family time or work hours towards earning a living wage outside of college hours.
The Benefits of Using GraduateWriterHelp.com
Using GraduateWriterHelp.com gives you access to experts from all over the world who are highly qualified and experienced in helping graduate-level students to complete successful projects in various fields quickly and efficiently – something that would otherwise be difficult, if not impossible, given tight deadlines associated with most Ph.D./Master’s degree programs today. Moreover, using this platform makes it easier for students to keep up with multiple research tasks simultaneously since there are so many different experts available on tap at any one time – no longer will you have to put off studying one topic while focusing on another because of lack of resources! Additionally, having access to professional editors, proofreaders, but also formatters means that quality control standards aren’t sacrificed when finishing major pieces – since these individuals understand what makes up good academic writing better than anyone else and can offer guidance on how best one should go about making improvements along those lines. Finally, there is also an added cost-saving benefit associated with utilizing Graduate Writer Help compared to hiring an independent contractor (which could potentially run into thousands depending on length/complexity).
This service allows users only pay for what students need, which tends to be much lower overall because customers pay per hour rather than project basis, thus resulting to greater financial flexibility, especially for those just starting out postgraduate studies looking to conserve some pennies here there whenever possible!
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.Read more
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.Read more
Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.Read more
By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.Read more