SU 16 Flashcards
T or F Changes in accounting estimates do not require an emphasis of matter paragraph.
True
Mgmt is responsible for estimating the effects of future events
They can’t get conclusive evidence but they must 1. Estimate future events and if that’s not possible 2. Make required disclosures.
Things a predecessor auditor should do before reissuing a report
Read the current financial statements and compare it with the prior statements.
Obtain a representation letter from the current auditor and management.
Under PCAOB standards an emphasis of matter paragraph is required T or F
False. It is never required.
Emphasis of matter
Reports on special purpose statements require the auditor to add an emphasis of matter paragraph to the report.
emphasis of matter
This is not used to draw attention to an audit procedure, only matters presented or disclosed in the FS.