Q1. Which of the following is an independent auditor least likely to do with respect to a company’s financial statements?

A)   Prepare and accept responsibility for them.

B)   Provide an opinion concerning their fairness and reliability.

C)   Confirm assets and liabilities contained in them.

Q2. Which of the following would NOT require an explanatory paragraph added to the auditors’ report?

A)     Doubt regarding the "going concern" assumption.

B)     Statements that the financial information was prepared according to GAAP.

C)     Uncertainty due to litigation.

Q3. The standard auditor's report is most likely required to:

A)   provide an "unqualified" opinion if material uncertainties exist.

B)   provide reasonable assurance that the financial statements contain no material errors.

C)   provide reasonable assurance that management is reliable.

答案和详解如下：

Q1. Which of the following is an independent auditor least likely to do with respect to a company’s financial statements?

A)   Prepare and accept responsibility for them.

B)   Provide an opinion concerning their fairness and reliability.

C)   Confirm assets and liabilities contained in them.

Correct answer is A)

Auditors make an independent review of financial statements, which are prepared by company management and are management’s responsibility. It is the responsibility of auditors to confirm the assets, liabilities, and other items included in the statements and then issue an opinion concerning their fairness and reliability.

Q2. Which of the following would NOT require an explanatory paragraph added to the auditors’ report?

A)     Doubt regarding the "going concern" assumption.

B)     Statements that the financial information was prepared according to GAAP.

C)     Uncertainty due to litigation.

Correct answer is B)

The statements that the financial information was prepared according to GAAP should be included in the regular part of the auditors' report and not as an explanatory paragraph. The other information would be contained in explanatory paragraphs added to the auditors’ report.

Q3. The standard auditor's report is most likely required to:

A)   provide an "unqualified" opinion if material uncertainties exist.

B)   provide reasonable assurance that the financial statements contain no material errors.

C)   provide reasonable assurance that management is reliable.

Correct answer is B)

The standard auditor's report contains three parts:

§     The financial statements are prepared by management and are their responsibility and the auditor has performed an independent review.

§     The audit was conducted using generally accepted auditing standards, which provides reasonable assurance that there are no material errors in the financial statements.

§     The auditor is satisfied the statements were prepared in accordance with accepted accounting principles, and the principles chosen and estimates are reasonable.

Under U.S. GAAP, the auditor is required to state an opinion on the company's internal controls. The auditor may add this opinion as a fourth element of the auditor's report or provide it separately.

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