A1 -Audited Financial Statements - Comparative FS

Question 1

When reporting on comparative financial statements, an auditor ordinarily should change the previously issued opinion on the prior year’s financial statements if the:

Answer 1

Prior year’s financial statements are restated to conform with generally accepted accounting principles.

Question 2

If the financial statements of a prior period have been audited by a predecessor auditor whose report is NOT PRESENTED, the successor auditor should:

Answer 2

Indicate in an Other-Matter paragraph of the report:

1) Financial statements of the prior period were audited by another auditor
2) the date of the previous report
3) the type of report issued
4) if the report was other than an unmodified report

Question 3

Before reissuing the prior year’s auditor’s report on the financial statements of a former client, the predecessor auditor should obtain letters of representation from:

Answer 3

Successor auditor AND the former client’s management

Question 4

If the auditor reissues the audit report at the client’s request, the auditor should:

Answer 4

Use the original report date on the reissued report. Use of a subsequent date implies that the auditor has done additional work.

Question 5

What is dual dating used for?

Answer 5

It is used when there is a subsequent event occurring after the original date of the auditor’s report, and the auditor wishes to extend responsibility only for the one event. - IT IS NOT USED FOR COMPARATIVE FS.