Reporting on the Summary Financial Statements

Question 1

What are summary financial statements?

Answer 1

Historical financial information that is derived from financial statements but that contains less detail than the financial statements, while providing a structured representation consistent with that provided by the financial statements.

Question 2

T/F: The auditors must have been engaged to audit the financial statements as w hole in order to accept an engagement to report on summary financial statements?

Answer 2

TRUE

Question 3

Summary of financial statements MUSt be accompanied by audited financial statements. They must be READILY AVAILABLE.

Answer 3

TRUE!

They cannot be made “available upon request”… that doesn’t count

If available on the entity’s website, that is okay.

Question 4

T/F: The financial statements summary needs to be adequately disclosed?

Answer 4

TRUE- they have to be adequately disclosed.

Question 5

The summary needs to be compared by the auditor to the complete set of audited financial statements?

Answer 5

TRUE- they have to be compatible with the applied criteria. Do they contain enough disclosure.

The summary should not be misleading to the intended user

Question 6

T/F: The auditor should issue an opinion on the summary of financial statements?

Answer 6

TRUE

You can either have an UNMODIFIED OR ADVERSE OPINION (ONLY)

UNLESS!! The audited financial statements are adverse or have a disclaimer of opinion, you do not issue an opinion on the summary of financial statements