ned to afford a reasonable basis for the opinion regarding financial statements under audit.     The audit opinion relates only to the client's financial statements, and does not relate to required footnotes.     If the auditor has reservations about the fairness of pres

Question 4 Respond to each of the following independent situations involving auditor reports. For each scenario (1)identify the reporting issue involved; (2) explain the type of opinion that should be issued; (3) identify any requiredmodifications of the standard auditor'sreport. The auditor has a disagreem ent with a client overthe adequacy of the recorded bad debt expense and allowance for doubtful accounts. The auditor is convinced that the expense and allowance are understatedby amaterial (but not highly material) amount, but the client has refused to adjust the accounts. 1.4 The auditor has issued a report on a client's financial statem ents prepared on a regulatory basis of accounting. The auditor is also preparing to issue a separate report- on the same client's GAAP financial statements, which will be issued to the public. The auditor feels that the issuance of the report on the regulatory basis statements should be disclosed in the report on the GAAP statements. The auditor…

25. Which of the following would not be included in an accountant's review report on the financial statements of a nonpublic entity? Group of answer choices   A statement that the review was made in accordance with generally accepted auditing standards.   A statement that all information included in the financial statements is the representation of management.   A statement describing the principal procedures performed.   A statement describing the auditor's conclusions based on the results of the review.

4. Which of the following statements is true regarding the independent auditors' report? a) A qualified opinion is considered a "clean" opinion since the financials qualify as being in accordance with GAAP. b) An unmodified (unqualified) opinion is given when the financial statements are fairly stated in all material respects, except for a certain issue that the auditors identify in a separate paragraph in their report. c) A disclaimer of opinion is given when the auditors have completed the audit and have found that the financial statements are not fairly stated in all material respects. d) Adverse opinions are fairly common, due to the adverse relationships between auditors and their clients. e) None of the above.

Question 22 Which statement is correct concerning a disclaimer of opinion and an adverse opinion? Group of answer choices A disclaimer of opinion indicates that the auditor has not been able to gather enough evidence to render an opinion on the financial statements, while an adverse opinion indicates that the financial statements are materially misstated. A disclaimer of opinion indicates that the financial statements are materially misstated, while an adverse opinion indicates that the auditor has not been able to gather enough evidence to render an opinion on the financial statements The opinions are generally equivalent, except an adverse opinion includes a going concern paragraph Adverse opinions indicate that the financial statements are materially misstated, while a disclaimer indicates that the financial statements are "so wrong" that no opinion can be given