Auditor's Standard Report

Question 1

Whats on the title on an Auditors standard Report?

Answer 1

INDEPENDENT AUDITOR’S

REPORT

Question 2

To whom is the auditors Report generally addressed?

Answer 2

TO: Board of directors of ABC company.

And/or It’s stockholders.

Question 3

What’s the first part of the introductory paragraph of the Auditor’s Standard Report?
Hint: What have we audited?

Answer 3

We have audited the accompanying B/S of ABC company as of Dec 31 Y 2and Y1 and the related statements of Income, Retained Earnings, and cash flow for the year then ended.

Question 4

What’s the 2nd part of the introductory paragraph of the Auditor’s Standard Report?

Hint: who is responsible for the F/S?

Answer 4

R R
These financial statements are the responsibility (R) of the Company’s management.

Our responsibility (R) is to express an opinion on these financial statements based on our audit.

Question 5

What’s the first part of the Scope Paragraph?
Hint: The audit is conducted in accordance with?
AA
PP
MM

Answer 5

We conducted our Audit (A) in accordance (A) with auditing standards generally accepted in the United States of America (GAAS = Scope Paragraph).
Those standards require that we plan (P) and perform (P) the audit to obtain reasonable assurance about whether the financial statements are free of material (M) misstatements (M).

Question 6

What’s the 2nd part of the Scope Paragraph?
Hint: What does an Audit Includes?
E E

Answer 6

An audit Includes examining (E), on a test basis, evidence (E) supporting the amounts and disclosures in the financial statements.

Question 7

What’s the 3rd part of the Scope Paragraph?
Hint: What does an audit also includes?
A A
M M

Answer 7

An audit also includes assessing (A) the accounting (A) principles used and significant estimates made (M) by management (M), as well as evaluating the overall financial statement presentation.

Question 8

What’s the last part of the Scope Paragraph?

Hint: What does the auditors believe?

Answer 8

We believe our audit provides a reasonable basis for our opinion.

Question 9

What’s the Opinion paragraph of the Auditor’s Standard Report?
Hint: In the auditor’s opinion how are the F/S presented?
& in conformity with what principles?

Answer 9

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of ABC Company as of (at) December 31, Y2 and Y1, and the results of its operations and its cash flows for the year then ended in conformity with accounting principles generally accepted in the United States of America (GAAP = Opinion Paragraph).

Question 10

Whats at the bottom of the of the Auditor’s Standard Report?

Answer 10

Manual or printed signature (Firm name)

Date (normally last day of field work)