M6-Interim Reviews

Question 1

An accountant may issue a review report on one financial statement, such as a balance sheet, not on other related financial statements, if the scope of the accountant’s inquiry and analytical procedures has not been restricted. (true or false)

Answer 1

true

Question 2

An accountant must maintain independence in mental attitude in all matters relating to the engagement in a review. (true or false)

Answer 2

true

Question 3

A review of the interim financial information of a publicly held company is conducted in accordance with PCAOB standards. (true or false)

Answer 3

true

Question 4

A review of quarterly financial data included in financial statements of a nonissue is performed under Statements on Auditing Standards, not under PCAOB standards. (true or false)

Answer 4

true

A review of interim financial information under PCAOB standards in conducted for public companies (or companies anticipating going public).

Question 5

The objective of a review of interim financial information is to provide the accountant, through inquiries and analytical procedures, with a basis for reporting whether material modifications should be made to such information to conform with GAAP. (true or false)

Answer 5

true

Question 6

If a report on a review of interim financial information is presented in a registration statement, the prospectus should include a statement that the report is not a “report” or “part” of the registration statement. The accountant should also read the other portions of the registration statement to ensure that his or her name is not used in a way that indicates greater responsibility than s/he intends. (true or false)

Answer 6

true