Question
What kind of opinion should the auditors express in each separate case?. Approximately 20% of the audit of Lumberton Farms, Inc., was performed by a
What kind of opinion should the auditors express in each separate case?.
Approximately 20% of the audit of Lumberton Farms, Inc., was performed by a different CPA firm, selected by you. You have reviewed their audit files and believe they did an excellent job on their portion of the audit. Nevertheless, you are unwilling to take complete responsibility for their work. Answer 1Choose...Issue an unmodified opinion with modified wordingIssue qualify both the scope and opinion paragraphs.Issue a standard unmodified report.Issue qualify the opinion paragraph.Issue an adverse opinion.Issue unmodified opinion with an explanatory paragraph.Issue disclaim an opinion. The entity is defending a lawsuit on product liability claims. (Customers allege that power saw safety guards were improperly installed.) All facts about the lawsuit are disclosed in the notes to the financial statements, but the auditors do not believe the entity should record a loss based on a possible settlement mentioned by the entitys attorneys. Answer 2Choose...Issue an unmodified opinion with modified wordingIssue qualify both the scope and opinion paragraphs.Issue a standard unmodified report.Issue qualify the opinion paragraph.Issue an adverse opinion.Issue unmodified opinion with an explanatory paragraph.Issue disclaim an opinion. Intelligis Electronics is a manufacturer of advanced electrical components. During the year, changes in the market resulted in a significant decrease in the demand for their products, which are now being sold significantly below cost. Management refuses to write-off the products or to increase the reserve for obsolescence. Answer 3Choose...Issue an unmodified opinion with modified wordingIssue qualify both the scope and opinion paragraphs.Issue a standard unmodified report.Issue qualify the opinion paragraph.Issue an adverse opinion.Issue unmodified opinion with an explanatory paragraph.Issue disclaim an opinion. During your audit of Raceway.com, Inc., you conclude that there is a possibility that inventory is high level materially overstated. The client refuses to allow you to expand the scope of your audit sufficiently to verify whether the balance is actually misstated. Answer 4
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