What is an auditor's responsibility for supplementary information, such as segment information, that is outside the basic financial statements, but required by the FASB?
A. The auditor has no responsibility for required supplementary information as long as it is outside the basic financial statements.
B. The auditor's only responsibility for required supplementary information is to assist in preparing the supplementary information.
C. The auditor is required to read the other information and consider whether such information is consistent with the information in the financial statements.
D. The auditor should apply tests of details of transactions and balances to the required supplementary information and report any material misstatements in such information.
Answer: The auditor is required to read the other information and consider whether such information is consistent with the information in the financial statements.
An engagement to express an opinion on a system of internal control will generally
A. Only require those procedures already applied in assessing control risk during a financial statement audit.
B. Increase the reliability of the financial statements that have already been audited.
C. Be more extensive in scope than the assessment of control risk made during a financial statement audit.
D. Be more limited in scope than the assessment of control risk made during a financial statement audit.
Answer: Be more extensive in scope than the assessment of control risk made during a financial statement audit.
When audited financial statements are presented in an entity's document containing other information, the auditor should
A. Perform inquiry and analytical procedures to ascertain whether the other information is reasonable.
B. Add an explanatory paragraph to the auditor's report without changing the opinion on the financial statements.
C. Perform the appropriate substantive auditing procedures to corroborate the other information.
D. Read the other information to determine that it is consistent with the audited financial statements.
Answer: Read the other information to determine that it is consistent with the audited financial statements.
