Which of the following statements is correct concerning letters prepared for underwriters, commonly referred to as"comfort letters" (a) Letters for underwriters are required by the Securities Act of 1933 for (b) (c) (d) the initial public offering of registered securities. Letters for underwriters typically give negative assurance on unaudited interim financial information. Letters for underwriters are required to be included in the registration statement that accompanies a prospectus. Letters for underwriters are used to update the auditors' opinions on the prior year's financial statements. publicly held company issues financial statements that fairly present the financial position of cash flows. The auditor would normally express a(n): (a) Disclaimer of opinion. (b) Unqualified opinion with explanatory paragraph. (c) Qualified opinion. (d) Adverse opinion. and results of operations but does not include the statement In which of the following situations would an auditor ordinarily issue a standard unmodified audit report with no explanatory paragraph? (a) 9. The client has changed from one GAAP method to another GAAP method, with which the auditor agrees. The auditor wishes to emphasize that the company had material related party transactions The auditor desires to make a reference to the report of another auditor as a basis for the auditor's opinion. The auditor has serious doubts about the company's ability to continue as a going concem, but the circumstances surrounding these doubts are fully disclosed in the financial statements. (b) (c) (d) A company's financial statements contain a departure from GAAP that, due to unusual circumstances, would be misleading if GAAP were properly applied. The auditor should express a(n): (a) Unqualified opinion with no mention of the departure from GAAP in 10. the auditor's report. Qualified opinion with an explanatory paragraph describing the departure from GAAP Qualified or adverse opinion, depending upon the materiality of the departure, with an explanatory paragraph describing the departure from GAAP. Unqualified opinion with an explanatory paragraph describing the departure from GAAP. (b) (e) (d)