multiple-choice

question 1: during a review of financial statements, an Accountant decides to emphasize a matter in the review report. Which of the following is an example of a matter that the accountant would most likely emphasize?

1. The IRS has notified the entity that it intends to audit income tax returns for a prior year.

2. The entity had significant transactions with a related parties

3. The entity has significant tax expenses as a result of new tax law

4. other entities in the same industry have recently changed from LIFO TO FIFO.

question 2. The audit report will ordinarily contain when management will not permit inquiries outside of legal counsel?

1. unmodified opinion with separate emphasis of matter paragraph

2. subject to qualified opinion

3. except for qualified opinion

4. disclaimer of opinion