The auditors determined that the entity is suffering financial difficulty and its going concern status is serious in doubt. Assuming the entity adequately disclosed this matter in the financial statements, the auditor must choose between which  of the following  report alternatives?     Unmodified opinion with a reference to going concern or disclaimer of opinion.     Standard unmodified report or a disclaimer of opinion.     Qualified or adverse opinion.     Standard (unmodified) report or adverse opinion.

Question 15       As Review of Financial Statements under SSARS is not considered an audit engagement the accountant need not be independent. Answers: True   False

The auditors include an emphasis-of-matter paragraph in an otherwise unmodified report on the entity's financial statements to emphasize that the entity being reported on had significant transactions with related parties. The inclusifis considered a qualification of the opinion.on of this separate paragraph

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…