Chapter 17 Assignment Acc410

Topics: Auditor's report, Generally Accepted Accounting Principles, Depreciation Pages: 2 (395 words) Published: April 15, 2013
Chapter 17 Assignment

SituationList AList B
1. In auditing the long-term investments account, an auditor is unable to obtain audited financial statements for an investee located in a foreign country. The auditor concludes that sufficient appropriate audit evidence regarding this investment cannot be obtained.Either an “except for” qualified opinion Describe the circumstances in an explanatory paragraph preceding the opinion paragraph, and modify the scope and opinion paragraphs. 2. Due to recurring operating losses and working capital deficiencies, an auditor has substantial doubt about an entity’s ability to continue as a going concern for a reasonable period of time. However, the financial statement disclosures concerning these matters are adequate.An unqualified opinion Describe the circumstances in an explanatory paragraph following the opinion paragraph without modifying the three standard paragraphs. 3. A principal auditor decides to take responsibility for the work of another CPA who audited a wholly owned subsidiary of the entity and issued an unqualified opinion. The total assets and revenues of the subsidiary represent 17 percent and 18 percent, respectively, for the total assets and revenues of the entity being audited.An unqualified opinion Describe the circumstances within the scope and opinion paragraphs without adding an explanatory paragraph. 4. An entity issues financial statements that present financial position and results of operations but omits the related statement of cash flows. Management discloses in the notes to the financial statements that it does not believe that statement of cash flows to be a useful financial statement.An "except for" qualified opinionDescribe the circumstances in an explanatory paragraph preceding the opinion paragraph, and modify the opinion paragraph. 5. An entity changes its depreciation method for production equipment from straight-line to a units-of-production method based on hours of...
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