Perry \& Price audited Bond's consolidated financial statements for the years ended December 31, 19X4 and 19X3. These financial statements are being presented on a comparative basis and an unqualified opinion is being expressed.

Adler, an assistant on the engagement. drafted the following auditor's report on May \(3,19 \times 5\), the date of completion of the fieldwork.

{Auditor's Report}
We have audited the accompanying consolidated balance sheets of Bond Company and subsidiaries as of December 31. 19X4 and 19X3, and the related consolidated statements of income, retained earnings, and cash flows for the years then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Bond Company and subsidiaries as of December \(31,19 \times 4\) and 19X3, and the results of its operations and its cash flows for the years then ended in conformity with generally accepted accounting principles.

Required:
Smith reviewed Adler's draft and indicated in the following Supervisor's Review Notes that there were deficiencies in Adler's draft. Items a through i represent the deficiencies noted by Smith. For each deficiency, indicate whether Smith is correct or incorrect in the criticism of Adler's draft.

SUPERVISOR'S REVIEW NOTES

a. The report is improperly titled.

b. All the basic financial statements are not properly identified in the introductory paragraph.

c. There is no reference to the American Institute of Certified Public Accountants in the introductory paragraph.

d. The report does not state in the scope paragraph that generally accepted auditing standards require analytical procedures to be performed in planning an audit.

e. The report does not state in the scope paragraph that an audit includes assessing internal control.

f. The report does not state in the scope paragraph that an audit includes assessing significant estimates made by management.
g. There is no reference to the balance sheet in the opinion paragraph.
h. The second standard of reporting requires a reference to consistency in the opinion paragraph.
i. The report date is incorrect.

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Perry & Price, CPAs May 3, 19X5