Answer the following questions Question 1: Answer the following questions: (A1, D1) (10 Points) 1- The auditors' report consists of three paragraphs. Identify the three paragraphs and describe the purpose and the elements of each? And what is the significance date of the auditor's standard report? (4 points) Sample Auditor's Standard Report Report of Independent Public Accountants To the Stockholders and the Board of Directors of Delta Air Lines, Inc: We have audited the accompanying consolldated balance sheets of DeLTA AIr Links, Ive. (a Delaware corporation) and subsidiaries as of June 30, 1992 and 1991, and the related consolidated statements of operations, cash flows and common stockholders' equity for each of the three years in the period ended June 30, 1992. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements. based on our audits. . -1 We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of matefial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Delta Air Lines, Inc. and subsidiaries as of June 30, 1992, and 1991, and the results of their operations and their cash flows for the periods stated, in conformity with generally accepted accounting principles. Arthur Anduen 5 co. Basic Elements of Auditor's Standard Report Includes the word independent Board of Directors and/or Stockhulkers of Entity Identifies: - type of service performed "We have audited"? - rinancial statements audited Introductory Paragraph - entity audited - dates of statements - management's responsibility for statements - auditor's responsibillty for opinion States: - audit conducted in accordance with GNAS, which requires: o planning and performing audit to obtain rearsonable assurance that statements are free of material misstatement o examining evldence on a test basis - assessing accounting principles used and sig- Paragraph nificant estimates made by management o evaluating overall financial statement presentation - auditor's belief that audit provides reasonable basis for opinion Expresses: - auditor's opinion as to whether financial sta Opinion ments: o present fairly, in all material respects, o the company's financial position at bala sheet date o the results of operations and cash flow period o in confomity with GAAP Firm's signature Manual or printed Date Last day of field work August 14, 1992 Answer the following questions Question 1: Answer the following questions: (A1, D1) (10 Points) 1- The auditors' report consists of three paragraphs. Identify the three paragraphs and describe the purpose and the elements of each? And what is the significance date of the auditor's standard report? (4 points) Sample Auditor's Standard Report Report of Independent Public Accountants To the Stockholders and the Board of Directors of Delta Air Lines, Inc: We have audited the accompanying consolldated balance sheets of DeLTA AIr Links, Ive. (a Delaware corporation) and subsidiaries as of June 30, 1992 and 1991, and the related consolidated statements of operations, cash flows and common stockholders' equity for each of the three years in the period ended June 30, 1992. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements. based on our audits. . -1 We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of matefial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Delta Air Lines, Inc. and subsidiaries as of June 30, 1992, and 1991, and the results of their operations and their cash flows for the periods stated, in conformity with generally accepted accounting principles. Arthur Anduen 5 co. Basic Elements of Auditor's Standard Report Includes the word independent Board of Directors and/or Stockhulkers of Entity Identifies: - type of service performed "We have audited"? - rinancial statements audited Introductory Paragraph - entity audited - dates of statements - management's responsibility for statements - auditor's responsibillty for opinion States: - audit conducted in accordance with GNAS, which requires: o planning and performing audit to obtain rearsonable assurance that statements are free of material misstatement o examining evldence on a test basis - assessing accounting principles used and sig- Paragraph nificant estimates made by management o evaluating overall financial statement presentation - auditor's belief that audit provides reasonable basis for opinion Expresses: - auditor's opinion as to whether financial sta Opinion ments: o present fairly, in all material respects, o the company's financial position at bala sheet date o the results of operations and cash flow period o in confomity with GAAP Firm's signature Manual or printed Date Last day of field work August 14, 1992