Consider the following statements: 1. An Emphasis of a Matter paragraph ". refers to something that has been appropriately presented or disclosed in the financial statements Il. The audit report is modifiedto five paragraphs as a result of another audit firm performing part of the financial statement audit (Refer to Shared Report topic). a. I is true: Il is true b. I is true; lisfalse c. lis false; Il is true d. I isfalse; II is false 2. Consider the following statements 1. Inconsistent application of accounting principles (i.e. a change in accounting principle, ll. For a change in accounting principles that management does not justify to the auditor, which the auditor agrees is acceptable) would result in a qualified audit opinion. the auditor will likely choose between a qualified or an adverse opinion. a. I is true; Il is true b. I is true; Il is false c. Iis false; II is true d. I is false; Il is false 3. Consider the following statements: l. The failure of a client to include a Statement of Cash Flows will result in the issuance of a disclaimer of opinion by the auditor ll, If the CPA firm is not independent of the entity being audited, the (PA firm is requred to issue a [one-paragraph] disclaimer of opinion a. I is true; Il is true b. is true; ll is false C. I is false; Il is true d. Iis fal se; Il is false 4. In which of the following instances would an auditor most likely issue a standard unqualified opinion WITH an explanatory paragraph? a. Management discdosures are missing or inadequate b. There is substantial doubt about the entity's ability to continue as a going-concern. c. Due to staffing issues, the audit report was issued later than in previous years d. There is an material deviation from GAAP related to capitalizing repairs 5. Which one of the following is an example of the contents of an opinion paragraph found in an audit report? a. "We have audited b. "Nothing came to our attention C. "The financial statements referred to above present farly." d. "An audit incdudes examining on a test basis