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Unformatted text preview: e in his report that part of the audit was made by another
Choice "b" is incorrect. The principal auditor's decision not to assume responsibility for the other auditor's
work need not be included in the engagement letter.
Choice "c" is incorrect. The principal auditor does not need permission from the other auditor to assume
responsibility. Permission is needed only if the principal auditor decides to divide responsibility and would
like to refer to the other auditor by name.
When financial statements contain a departure from GAAP because, due to unusual circumstances, the
statements would otherwise be misleading, the auditor should explain the unusual circumstances in a
separate paragraph and express an opinion that is:
Qualified or adverse, depending on materiality. CPA-02764
Choice "a" is correct. When circumstances indicate that financial presentation in accordance with GAAP
would be misleading, a departure from GAAP is permissible. In such cases, the auditor should disclose...
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- Fall '12