Exam 11: Completing the Audit 500

Auditors conclude that the omission of a substantive procedure considered necessary at the time of the examination may impair their present ability to support the previously-expressed opinion. Auditors need not try to perform the omitted procedure if

In an audit of contingent liabilities, which of the following procedures would be least effective?

What course of action should auditors take if, after evaluating management's plan to mitigate the effect of factors that suggest going-concern uncertainties, they believe that substantial doubt about going concern does not exist?

You are auditing Green Corporation for the calendar year 2020. Among other items related to the audit, Green Corporation was being sued for personal injury resulting from the malfunction of one of their products. The lawsuit was initiated by Sue Ewe in September, 2020. Management and the company's outside legal counsel estimated the loss from the suit to be approximately $250,000. This amount is accrued and properly disclosed in the footnotes of the financial statements. You have no reason to believe that the estimate is inaccurate. You completed your audit and dated your report March 2, 2021. The financial statements were issued on March 14, 2021. On March 20, 2021, you read in a national business periodical that the jury in the trial awarded Sue Ewe $1.5 million.Required:Discuss the nature of these events and what responsibility, if any, you have regarding the news of March 20, 2021.

Auditors have a responsibility to evaluate whether financial statements properly reflect all known events through the:

Subsequent events occur between the __________ and the __________.

Define what is meant by the term "subsequent event". In addition, identify the two types of subsequent events and indicate how auditors should modify the engagement for the discovery of subsequent events.

Which of the following would not ordinarily be considered when using analytical procedures to verify the overall reasonableness of revenue and expense accounts?

For each of the communications listed below, select the appropriate time period during which the communication is typically obtained or provided and whether the communication is oral, written, or either oral or written. Communications with individuals charged with governance

Assume that Rory is auditing the financial statements of Augusta, Inc. Rory completes his fieldwork on February 25 and his report (along with Augusta's financial statements) is issued on March 1. On March 3, a hurricane destroys a warehouse that contains a significant amount of uninsured inventory. Which of the following best describes Rory's responsibility with respect to the effects of this hurricane on Augusta's financial statements?

For each of the communications listed below, select the appropriate time period during which the communication is typically obtained or provided and whether the communication is oral, written, or either oral or written. Attorney letter response

For each of the communications listed below, select the appropriate time period during which the communication is typically obtained or provided and whether the communication is oral, written, or either oral or written. Management letter

Management letters are not a means of

Why is it the client's decision to record adjustments to the financial statements?

Which of the following subsequent events would represent an event that provides information about conditions that arose following the date of the financial statements?

Long and Short, CPAs, were auditing Island Corporation for the year ended December 31, 2020. On January 11, 2021, a major customer of Island Corporation declared bankruptcy as the result of an uninsured loss due to a major fire in their warehouse on January 8, 2021. As a result, a material accounts receivable from the customer was determined to be uncollectible. Long and Short, CPAs, would expect the client to

Before the impact of adjusting entries proposed by auditors are included in the client's financial statements, the adjustments must be approved by the

Which of the following is not a purpose of the review of audit documentation by a supervisor during fieldwork?

An important method used by auditors to learn of material contingencies is

The primary source of information auditors use to obtain information about litigation, claims, and assessments is the