This questien will be sent to your instructor for grading.

TB ES Qu$.17-80$ Use the worksheet to reply to the...

Use the worksheet to reply to the eight situations below that relate to the audit of financial statements of nonpublic companies. Unless indicated obterwise. assume that material amounts are involved. Do not consider including an emphasis of matter section $($paragraph$)$ in an "auditor discretionary" circumstance.

Situations:

A company has departed from GAAP.

A company's inventory records were deficient and the auditor was required to satisfy herself that the inventory was properly stated using athernative procedures. She is satisfied that she has sufficient appropriate evidence.

In auditing a client, an auditor has determined that substantial doubt exists about an entity's ability to continue as a going concern.

A group auditor decides not to take responsibility for the work of the component audinor who audited a $70\%$ owned subsidiary and issued an unmodiled opinion. The total assets and revenues of the subsidiary are $5\%$ and $8\%,$ respectively, of the total assets and revenues of the entity being auditied.

A company changes from FIFO to LIFO for inventory valuation and the auditor concurs with the change. The change has a material effect on the comparability of the entity's financial statements this year, but is expected to have an immaterial effect in the future.

Inadequate record retention policies by the client have resulted in a stuation in which a CPA is unable to obtain sufficient appropriate audit evidence with

A CPA has decided to emphasize in the audit report that the company she audited is a component of XYZ Company, its parent. respect to a material account.

A client has changed its estimate of likely doubtful accounts from $2\%$ of credit sales to $3\%.$ The auditor believes the change to be reasonable.

Opinion Types:

Adverse

Disclaimer

Qualified

Unmodified

Not needed

Other Modification: