AUD 1 - Emphasis-of-Matter, Other-Matter, and Explanatory Paragraphs

Question 1

Does an explanatory paragraph for issuer (public company) affect an auditor’s opinion?

Answer 1

It DOESNT NOT AFFECT the auditor’s opinon?

Question 2

Is there a title for an explanatory paragraph for issuer (public company)?

Answer 2

There is no title for an explanatory paragraph

Question 3

What is the placement of an explanatory paragraph for an issuer (public company)? What is the exception?

Answer 3

Generally AFTER the opinon paragraph BUT

BEFORE the opinon paragraph when:

1) Financial statements are prepared under special purpose framework
2) PY audit opinon is updated

Question 4

When is an explanatory paragraph for an issuer (public company) required?

Answer 4

1) PY opinion is updated
2) Special purpose framework is used
3) Going concern
4) Material change in accounting principle between periods
5) Material misstatement previously issued and corrected
6) SEC Regulation S-K has been omitted
7) Supplementary information is omitted

Question 5

Does emphasis-of-matter, other-matter, and explanatory paragraph change opinion?

Answer 5

No changes to opinion when paragraphs are used. It is still an umodified opinion.