Question

Which of the following would not require an explanatory/emphasis-of-matter paragraph in the auditor's report?

a. Additional emphasis.
b. Lack of consistency in the financial statements due to accounting changes.
c. Going concern.
d. Opinion based in part on the report of another auditor.

Answer 1

The correct answer is d. Opinion based in part on the report of another auditor would not require an explanatory/emphasis-of-matter paragraph in the auditor's report.

Step-by-step explanation:

The correct answer is d. Opinion based in part on the report of another auditor would NOT require an explanatory/emphasis-of-matter paragraph in the auditor's report.

An explanatory/emphasis-of-matter paragraph is used in the auditor's report to draw attention to certain matters that are already adequately presented or disclosed in the financial statements.

Examples of matters that would typically require an explanatory/emphasis-of-matter paragraph include going concern issues, lack of consistency in the financial statements due to accounting changes, or additional emphasis on a specific matter within the financial statements.