Odte Normal Tie Subtitle Dictate Abecode AaBCCD ABCDdEt AaBb anced HE a No Spacing Heading Heading 2 Styles Sensi Pane 22. Which of the following accounting changes requires an emphasis-of-matter paragraph regarding consistency in a nonpublic company auditors' report? A. A change in the estimated useful lives of a class of fixed assets. B. A write-off of a patent because future benefits do not appear to exist. . A change from the straight-line method of depreciation to an accelerated method for a class of fixed assets. D. A change in calculating bad debt expense from one percent to two percent of credit sales. 23 A client has changed the salvage values of a number of its fixed assets. The auditors of the public company believe that the revised salvage values are realistic. The appropriate report on the financial statements is: Standard unqualified. Unqualified with explanatory language as to consistency. Qualified for consistency. Disclaimer 24 Which of the following would most likely be an appropriate addressee for an audit report? The shareholders of the corporation whose financial statements were examined. A third party who requested that a copy of the audit report be sent to her. The president of the corporation whose financial statements were examined. The chief financial officer. 25 B D The term "except for in an audit report is: Used in an adverse opinion. No longer considered appropriate Used in a qualified opinion Used for an unmodified opinion when an emphasis of matter paragraph is added 26. A D The unmodified standard audit report of a nonpublic company does not explicitly state that: The financial statements are the responsibility of the company's management The audit was conducted in accordance with accounting principles generally accepted in the United States of America The auditors believe that the audit provides a reasonable basis for their opinion. An audit includes assessing the accounting principles used. Which of the following is not a difference between the audit report of a nonpublic and public company? The public company report includes the word "Registered in the title. The public company report refers to standards of the PCAOB The public company report has an additional paragraph referring to the client's fraud prevention procedures, The public company report is more likely to refer to a critical audit matter. 27. B I 28 Which of the following modifications of the auditors' report does not include an additional paragraph? The report is qualified because the financial statements contain a material departure from generally accepted accounting principles The report includes an emphasis of a matter. The audit report indicates a division of responsibility between two CPA firms. The report is qualified because the scope of the auditors' work was limited. glish (United States)
