Audit Reports Flashcards
What are the physical requirements of an audit report? (3)
> Must be in writing
Must be signed
Must include auditor’s address
- city and state where office located
What is the main statement of an unmodified opinion?
The F/S present fairly, in all material respects, the financial position of the entity as of the balance sheet date and the results of its operations and its cash flows for the period then ended, in accordance with the applicable financial reporting framework.
What is the format of an unmodified opinion format?
> Title - Must included " Independent" > Introductory Paragraph > Manager's Responsibility > Auditor's Responsibility > Audit Opinion
What is in intro paragraph (unmodified) (3)
Who, What, when
What is in the management’s resp? (5)
- Prep/fair presentation of financial
- Framework
- DIM Internal Control
What is auditor’s responsibility? (3)
- Audit with GAAS USA
- Plan/perform audit to obtain reasonable assurance
- Audit Description
Why is emphasis of matter paragraph?
When the information is presented fairly and disclosed, but the auditor wants to bring attention to something
Examples of Emphasis of Matter
Going Concern Updated report from a prior period litigation uncertainty related party transactions unusual subsequent events
Difference between emphasis of matter and other matter
Emphasis of matter is discuss matters already disclosed the other matter hasn’t been disclosed in the financial statements
Main statement of modified opinion?
Financial statements are materially misstated or unable to obtain sufficient appropriate evidence
What if you want to report on A/R separately from the whole financial statement?
Allowed to report on a specific item as long as the report is separate
What is the procedure of referring of component auditor’s work? (4)
> Perform additional audit procedures
Be involved in component auditor’s work
Perform risk assessment procedures
Assess Risk of material misstatement
What is the procedure of not referring of component auditor’s work? (no responsibility)
> Component auditor must have performed with GAAS standards
> F/S must prepared in the same framework as the group f/s
What org governs compilation/review reports?
SSARS
What company private or public allowed to do a compilation report?
Private
