1.You have been engaged to review financial statements of a small retail company. You have requested a management representation letter which is to be signed by key members of management. The key members of management refuse to sign the management representation letter. Which of the following represents the course of action you should follow?

Select one:

a.

Issue a qualified report.

b.

Disclaim an opinion.

c.

Withdraw from the engagement.

d.

Issue a letter indicating that there are significant deficiencies in the internal control structure.

2You are engaged to review the financial statements of XYZ Company. You determine that you are not independent with respect to XYZ because XYZ owes you fees which are over one year past due. In your review report, your options for reporting your lack of independence are:

Select one:

a.

You are not permitted to perform a review engagement or issue a review report because you are not independent.

b.

Your only option is to simply state, We are not independent with respect to XYZ Company.

c.

You have two options: To simply state that you are not independent with respect to XYZ Company, or to state that you are not independent with respect to XYZ Company because you have a financial interest in XYZ.

d.

You indicate in your review report that XYZ has not followed generally accepted accounting principles related to the non-payment of your fees.