Which of the following will result in an emphasis-of-matter paragraph as to consistency in the auditor's report, when that the item is fully disclosed in the financial statements? OA change from an unacceptable accounting principal to a generally accepted one. O Changing the life of an asset from 8 to 5 years. OA change in classification. A change in accounting estimate.

Which of the following will result in an emphasis-of-matter paragraph as to consistency in the auditor's report, when that the item is fully disclosed in the financial statements? OA change from an unacceptable accounting principal to a generally accepted one. O Changing the life of an asset from 8 to 5 years. OA change in classification. A change in accounting estimate.

Auditing: A Risk Based-Approach (MindTap Course List)

11th Edition

ISBN:9781337619455

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter15: Audit Reports For Financial Statement Audits

Section: Chapter Questions

Problem 12RQSC

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For which of the following events would an auditor issue a report that does not make any reference to consistency Select one: a. Management’s lack of reasonable justification for a change in accounting principle b. A change in the useful life used to calculate the provision for depreciation expense c. A change in the method of accounting for inventories d. A change from an accounting principle that is not generally accepted to one that is generally accepted
The client has restated the prior-year statements because of a changefrom LIFO to FIFO. How should this be reflected in the auditor’s report?
The accounting and auditing literature discusses several different types of accounting changes. For each of the changes listed below (a. through c.), indicate whether the auditor should add a paragraph to the audit report, assuming that the change had a material effect on the financial statements and was properly justified, accounted for, and disclosed. Assume that the organization is a U.S. non-public company. a. Change from one GAAP to another GAAP b. Change in accounting estimate not affected by a change in accounting principle c. Change in accounting estimate affected by a change in accounting principle d. Correction of an error c. Change from non-GAAP to GAAP (a special case of correction of an error)
Directions: Please select the appropriate answer on the statement below;B - If the statement is trueS - When the statement is false or part of the statement is false The objective of the first reporting standard is to ensure that comparisons of financial statements between periods do not have a material impact on changes in accounting standards or provide adequate disclosures if those changes have a material impact on the comparison of financial statements between periods.
Which of the following would be considered a change that affects consistency? * Change in accounting estimate. O Change in reporting entity. Change in classification and reclassification.
When it is difficult to distinguish a change in accounting policy from achange in an accounting estimate, the change is treated as A. Change in accounting estimate with appropriate disclosureB. Change in accounting policyC. Correction of an errorD. Initial adoption of an accounting policy
The accounting and auditing literature discusses several different types of accounting changes. For each of the changes listed below (a. through e.), indicate whether the auditor should add a paragraph to the audit report, assuming that the change had a material effect on the financial statements and was properly justified, accounted for, and disclosed. Assume that the organization is a U.S. nonpublic company. a. Change from one GAAP to another GAAP b. Change in accounting estimate not affected by a change in accounting principle c. Change in accounting estimate affected by a change in accounting principle d. Correction of an error e. Change from non-GAAP to GAAP (a special case of correction of an error)
The accounting and auditing literature discusses several different types of accounting changes. For each of the changes listed below (a. through e.), indicate whether the auditor should add a paragraph to the audit report, assuming that the change had a material effect on the financial statements and was properly justified, accounted for, and disclosed. Assume that the organization is a U.S. nonpublic company. a. Change from one GAAP to another GAAP b. Change in accounting estimate not affected by a change in accounting principle c. Change in accounting estimate affected by a change in accounting principle d. Correction of an error e. Change from non-GAAP to GAAP (a special case of correction of an error) PLEASE ANWSER ONLY SECTION D & E THANK YOU!
Before applying substantive procedures to the details of asset and liability accounts at an interim date, the auditor should: Mutiple Choice consider the sblity of the suditor to perform aporopriate substartive procedures to cover the remaining period. investigete significant uctiations thet have occured in the asset and lability accounts since the previous balance sheet date. select only those accounts wich can eflectively be samplied during year end audit work consider the compliance tests that mut be applied at the balance sheet date to extend the audit conclusions reached at the interim date.
Departures from GAAP. For each of the following departures from GAAP, indicate thetype of opinion that the auditors would issue as well as any modifications that would bemade to the standard (unmodified) report.a. A departure that had an immaterial effect on the financial statements.b. A departure that had a material effect on the financial statements (this effect was notpervasive and affected only one account).c. A departure that had a material effect on the financial statements and was pervasive(affected a number of accounts on both the balance sheet and income statement).
Type I Subsequent Events in auditing are : A. Are those events that provide new information about conditions existing at balance sheet date requiring adjustments in the financial statements. B. Involve events occurring after balance sheet date but not requiring to be disclosed in financial statements C. Provide new information about conditions occuring after the balance sheet date and requiring adjustments in financial statements. D. Involve events occurring after balance sheet date and require to be disclosed in financial statements
When interim financial information is presented in a footnote to annual financial statements,the standard audit report on the annual financial statements shoulda. Not mention the interim information unless there is an exception that the auditors need toinclude in the report.b. Contain an audit opinion paragraph that specifically mentions the interim financial information if it is not in conformity with GAAP.c. Contain an explanatory paragraph that gives negative assurance on the interim information if it has been reviewed.d. Contain an explanatory paragraph if the interim information note is labeled “Unaudited.”