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On February 2 5 , it CPA issued an auditor's report expressing an unqualified opinion on financial statements for the year ended January 3 1
On February it CPA issued an auditor's report expressing an unqualified opinion on financial statements for the year ended January On March the CPA learned that, on February the entity incurred a material loss on an uncollectible trade recervable as a result of the ongoing deterioration of the financial condition of the entity's principal customer, which finally led to the customet's bankruptcy. Management then refused to adjust the firancial statements for this subsequent event. The CPA determined that the information is reliable and that there are creditors currently relying on the financial statements. The CPA's neat course of action most likely would be to
a issue a revised auditor's report and distribute it to each creditor known to be relying on the financial statements.
b issue revised financial statements and distribute them to each creditor known to be refying on the finandal statements.
c notity each member of the entity's board of directors about management's refusal to adjust the finandial statements.
d notify the entitys creditors that the financial statements and the related auditor's report should ro langer be refied upon.
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