Comparative Statements and Consistency between Periods

Question 1

if substantial doubt about the going concern assumption disappears, so does the..

Answer 1

going concern section

Question 2

if an opinion has changed from previous F/S audit year, the change is explained in

Answer 2

an other-matter paragraph

Question 3

for comparative F/S, the continuing auditor should issue

Answer 3

one audit report that is on both presented years

Question 4

auditor will change the previously issued opinion on the prior year’s F/S if

Answer 4

the prior year’s F/S are restated to conform with generally accepted accounting principles

Question 5

predecessor auditor ________ refer to the report or the work of the successor auditor in a reissued report

Answer 5

should not

Question 6

when prior period review/compilation report is not reissued, include an other matter paragraph with…

Answer 6

-the prior period F/S were audited
-service (compilation, review) done in prior period
-date of prior period report (audit report date)
-description of modifications to the report
-that no auditing procedures have been applied since that report date

statement that
-prior service was substantially smaller in scope than an audit and didn’t provide an opinion (when prior service was a review)
OR
-prior service provided no assurance (when prior service was a compilation)

Question 7

if the change in accounting principle does not have material effect on comparability of F/S, then issue an

Answer 7

unmodified opinion

Question 8

if the change in accounting principle does have material effect on comparability of F/S, and the change is properly justified and disclosed then issue an

Answer 8

Unmodified with emphasis of matter

Question 9

if the change in accounting principle does have material effect on comparability of F/S, and the change is not properly justified and disclosed then issue a

Answer 9

qualified or adverse opinion

Question 10

material consistency is implicit in the claim that…

Answer 10

the F/S conform with GAAP

Question 11

predecessor auditor is not to be named when their auditor’s report is not presented, but the following information is indicated in the successor auditor’s report…

Answer 11

1. F/S of the prior period were examined by other auditors
2. the date of the other auditor’s report
3. type of opinion expressed
4. substantive reasons if it was other than modified

Question 12

when the prior year F/S are presented with current years and the auditor of the current F/S also audited the prior year’s F/S

Answer 12

the report is updated to cover both years