$7.$ An auditor discovered that a client made illegal political payoffs to a candidate for president of the United States. The auditor was unable to determine the amounts associated with the payoffs because of the client$$s inadequate record$-$retention policies. The client has added a note to the financial statements to describe the illegal payments and has stated that the amounts of the payments are not determinable.Disclaimer$\mathrm{.}18.$ An auditor discovered that a client made illegal political payoffs to a candidate for president of the United States. The auditor was unable to determine the amounts associated with the payoffs because of the client$$s inadequate record$-$retention policies. Although there is no likelihood that the financial statements are pervasively misstated, they may be materially misstated. The client refuses to disclose the payoffs in a note to the financial statements.Qualified$\mathrm{.}19.$ In auditing the long$-$term investments account of a new client, an auditor finds that a large contingent liability exists that is material to the consolidated company. It is probable that this contingent liability will be resolved with a material loss in the future, but the amount is not estimable. Although no adjusting entry has been made, the client has provided a note to the financial statements that describes the matter in detail.Unmodified with some modification of the report $($e$.$g$.,$ emphasis$-$of$-$matter, other matter, explanatory, other wording$)\mathrm{.}20.$ In auditing the long$-$term investments account of a new client, an auditor finds that a large contingent liability exists that is material to the consolidated company. It is probable that this contingent liability will be resolved with a material loss in the future, and this amount is reasonably estimable as $$2,000,000.$ Although no adjusting entry has been made, the client has provided a note to the financial statements that describes the matter in detail and includes the $$2,000,000$ estimate in that note.Qualified$\mathrm{.}21.$ A client is issuing two years of comparative financial statements. The first year was audited by another auditor who is not being asked to reissue her audit report. $($Reply as to the successor auditors' report.$)$Unmodified with some modification of the report $($e$.$g$.,$ emphasis$-$of$-$matter, other matter, explanatory, other wording$)\mathrm{.}22.$ A client is issuing two years of comparative financial statements. The first year was audited by another auditor who is being asked to reissue her audit report. $($Reply as to the successor auditors' report.$)$Unmodified$\mathrm{.}23.$ A client$$s financial statements follow GAAP, but the auditor wishes to emphasize in his audit report a significant related party transaction that is adequately described in the notes to the financial statements.Unmodified with some modification of the report $($e$.$g$.,$ emphasis$-$of$-$matter, other matter, explanatory, other wording$)\mathrm{.}24.$ A client$$s financial statements follow GAAP except that they do not include a note on a significant related party transaction.Qualified$\mathrm{.}25.$ During the audit of a public company, the auditors identified a critical audit matter. Sufficient appropriate audit evidence was gathered to indicate the related account was properly stated. The audit report to be issued includes a Critical Audit Matters section that properly describes the matter. Reply as to additional modifications required.Unmodified.

Adverse or disclaimer.

Adverse.

Disclaimer.

Other.

Qualified or adverse.

Qualified or disclaimer.

Qualified.

Unmodified with some modification of the report $($e$.$g$.,$ emphasis$-$of$-$matter, other matter, explanatory, other wording$).$

Unmodified.