Going Concern. Wilfrado Prada, Revisor Official de Contas (ROC), during the audit of Communique Exterior, SA, of Setubal, Portugal, found financial indications that there might be a going concern question. Prada applied additional procedures.

Required

A. Discuss how the following conclusions would affect Prada’s audit report:

1 There is reasonable assurance that Communique Exterior is a going concern.

2 The going concern assumption is appropriate by virtue of mitigating factors.

3 The going concern assumption is appropriate by virtue of mitigating factors, but the mitigating factors are not disclosed.

4 The going concern questions are not resolved.

B. Write the audit report of Communique Exterior. SA, with a paragraph emphasizing a going concern uncertainty, assuming that the going concern uncertainty is disclosed.