1. The following four situations require a modification to the standard unqualified audit report for public companies. Identify the modification required for each.

aOpinion based in part on the report of another auditor.

bGoing concern.

cLack of comparability.

dEmphasize a matter.

1. For each of the following situations, indicate what type of audit report is most appropriate.

aThe auditor lacks independence in fact, but not necessarily in appearance.

bThere is a scope limitation and it is material, but the overall financial statements are still presented fairly.

cThe uncorrected misstatements are immaterial.

dThere is a departure from GAAP and it is pervasively material.

1. Discuss three circumstances that prohibit the auditor from issuing an unqualified/unmodified opinion and the types of reports that the auditor may issue for a financial statement audit because of these circumstances.
2. Discuss the new enhancements implemented by the new PCAOB reporting standards for public entities.