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Chap012 - Chapter 12 Reports on Audited Financial...

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Chapter 12 - Reports on Audited Financial Statements Chapter 12 Reports on Audited Financial Statements Multiple Choice Questions 1. The scope paragraph of the standard report on the entity's financial statements does not include the statement A. "In conformity with generally accepted accounting principles." B. "Audit provides a reasonable basis for an opinion." C. "An audit includes assessing the accounting principles used." D. "Perform the audit to obtain reasonable assurance." 2. The opinion paragraph of the auditors' report on the entity's financial statements either implicitly or explicitly incorporates all of the following standards, except that the A. Financial statements are presented in conformity with U.S. GAAP. B. Informative disclosures are adequate unless otherwise stated. C. Financial statements are management's responsibility. D. Report identifies circumstances in which principles have not been consistently observed. 3. Which of the following statements is not included in the scope paragraph of the standard report on the entity's financial statements? 4. Auditors are required to make consistency references in the auditors' report when there are changes in 12-1
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Chapter 12 - Reports on Audited Financial Statements 5. If financial statements contain a material but "compartmentalized" departure from FASB pronouncements, the auditors should render a(n) 6. Auditors' reporting decisions on financial statements depend primarily on the A. Reporting principle. B. Sufficiency and appropriateness of evidence. C. Application of GAAP. D. Integrity of management. 7. When auditors are engaged to examine an entity's financial statements but decide to issue a disclaimer of opinion, the report would not
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