codification of 400 - Kelly Legner Codification AU 400s AU...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
Kelly Legner Codification AU 400’s AU 410 The auditor must state in the auditor’s report whether the financial statements are presented in accordance to GAAP. AU940 Financial statements that are prepared on the basis of accounting principles that are acceptable at the financial statement date but will not be acceptable in the future, the auditor should consider whether the disclosure of the impending change in principle and the resulting restatement are essential data. If the auditor decides that the matter should be disclosed and it is not the auditor should express a qualified or adverse opinion as to conformity with GAAP. .16 states that historical financial statements with pro forma data that give effect to the future adjustment as if it had occurred on the date of the balance sheet should be reported in a columnar form along the side of the historical statements. .17 the auditor needs to decide if the disclosure is needed for other effects that many result upon the required future adoption of an accounting principle. .18 The auditor must decide to include an explanatory paragraph in his report if the effects of the change are expected to unusually material. AU 411 An independent auditor’s report contains an opinion as to whether the financial statements present fairly, in al material respects, an entity’s financial position, results of operations, and cash flows in conformity with GAAP. .02 The first standard requires the auditor who has audited financial statements in accordance to GAAP to state in the auditor’s report whether the statements are presented in conformity with GAAP. .03 The auditor’s judgment concerning the “fairness” of the overall presentation of financial statements should be applied within the framework of GAAP. Without the framework, the auditor would have no uniform standard for judging the presentation of the financial position, results of operations, and cash flows in the financial statements. .04 The auditor’s opinion on the financial position should be based on his/her judgment as to whether a) the accounting principles selected and applied have general acceptance b) the accounting principles are appropriate in the circumstances; c) the financial statements, including the related notes, are informative of matters that many affect their use, understanding, and interpretation; d) the information presented in the financial statements is classified and
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Kelly Legner Codification AU 400’s summarized in a reasonable manner that is neither too detailed nor too condensed and e) the financial statements reflect the underlying transactions and events in a manner that presents the financial position, results of operations, and cash flow stated within a range of acceptable limits.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 8

codification of 400 - Kelly Legner Codification AU 400s AU...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online