Public company audit reports generally include a section on critical audit matters. For each of the following statements indicate whether you believe the statement is correct or incorrect.
For those you consider incorrect indicate why.
1. All significant risks identified in an audit constitute critical audit matters.
2. A Critical Audit Matters section follows at an appropriate point after the Basis for Opinion section in an audit report.
3. Critical audit matters are selected from matters communicated to those charged with governance.
4. Critical audit matters are not included in public company audit reports with qualified opinions.
5. In addition to being included in audit reports, critical audit matters are communicated to the PCAOB.
6. When comparative financial statements are presented, the Critical Audit Matters section must include those matters for all years of audited financial statements included.
7. All matters communicated to those charged with governance of a public company are critical audit matters.
8. Not all material weaknesses in internal control are also critical audit matters.
9. When no critical audit matters are identified in an audit, there will be no Critical Audit Matters section in a public company audit report.
10. Critical Audit Matters sections are not included in audit reports with an adverse opinion or a disclaimer of opinion.