8: reporting

Question 1

5 parts of an unmodified review report

Answer 1

Addressee

Scope and responsibilities

Nature of work and level of assurance

Conclusion

Signature

ALSO: descriptions of disagreements and limitations

Question 2

Effect of disagreements in reporting

Answer 2

Material: express a qualification of the negative assurance provided

Pervasive: give an adverse statement that the financial statements fo not give a true and fair view

Question 3

Effects of limitation of scope in reporting

Answer 3

Material: express a qualification of the negative assurance provided regarding the possible adjustments to the FS that might have been determined to be necessary if the limitation did not exist

Pervasive: do not provide any assurance

Question 4

Where do you find the auditor’s report in the open book

Answer 4

ISA (UK) 701

Question 5

Where would an emphasis of matter paragraph appear in an auditor’s report

Answer 5

After the basis section

Either before or after key audit matters

Question 6

Where would an ‘other matter’ paragraph appear in an auditor#s report

Answer 6

After key audit matters and emphasis of matter

Question 7

Two possible outcomes where an audit concludes the FS as a whole are not free from material misstatement eg disagreement with management

Answer 7

1. (mainly) qualified opinion, (‘except for’)

2. Adverse opinion - Conclude that the accounts fo not show a true and fair view

Question 8

Two possible outcomes where the audit is unable to obtain sufficient and appropriate evidence eg limitation on scope

Answer 8

1. qualified opinion (‘except for’) for just a particular aspect
2. Disclaimer of opinion - unable to form an opnion

Question 9

Matters to report by exception in the UK (RAPID) - in accordance with UKGC

Answer 9

Returns received for all branches

Accounts agree to records

Proper accounting records kept

Information requested from directors received

Directors emoluments disclosed

Key: Report P and I if insufficient audit evidence