CPA AUD Audit Reporting
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Avg score: 80% • Most missed: “According to the opinion paragraph found in the standard unmodified audit report…”
The CPA AUD (Auditing and Attestation) exam focuses heavily on reporting standards (10–20% of the exam), testing the ability to form conclusions and issue appropriate audit reports for issuers and non-issuers. Key areas include identifying the correct opinion type (unqualified, qualified, adverse, disclaimer), understanding required emphasis-of-matter paragraphs, and auditing with component auditors. Key Audit Reporting Concepts Types of Opinions: Unqualified (Clean): Financial statements are presented fairly in all material respects. Qualified: Material misstatements or scope limitations... Show more
CPA AUD Audit Reporting
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19 Questions

1. The preparation and fair presentation of the financial statements requires:
I. identification of the applicable financial reporting framework
II. inclusion of an adequate description of the framework
2. When an auditor expresses a qualified opinion due to a material misstatement of the financial statements, the auditor’s responsibility paragraph should be amended to state that the auditor believes that the audit evidence obtained is sufficient and appropriate to provide a basis for the auditor’s:
3. Which of the following is an implicit representation when issuing the auditor’s report on comparative financial statements under US auditing standards?
I. Obtaining evidence that is sufficient and appropriate
II. Consistent application of accounting principles
4. When a group auditor decides to make reference to the examination of a component auditor:
I. the group auditor’s report should not make reference to the “component auditor” in the auditor’s responsibility paragraph
II. the introductory paragraph is the same whether the auditor divides responsibility or not
5. When a group auditor decides to make reference to the examination of a component auditor:
I. the group auditor’s report should not make reference to the “component auditor” in the auditor’s responsibility paragraph
II. the introductory paragraph is the same whether the auditor divides responsibility or not
6. An auditor can issue an unmodified report without any reference to consistency when:
I. the client changes from straight line depreciation to accelerated depreciation
II. the client changes the useful life of an asset used to calculate depreciation expense
7. The preparation and fair presentation of the financial statements requires:
I. identification of the applicable financial reporting framework
II. inclusion of an adequate description of the framework
8. Under GAAS, in the auditor’s responsibility paragraph, how does an auditor describe his or her responsibility regarding the client’s internal controls?
9. According to the opinion paragraph found in the standard unmodified audit report:
I. the auditor has assessed the accounting principles and evaluated significant accounting estimates used by the reporting entity
II. “present fairly” and US generally accepted accounting principles (GAAP) are specifically referenced
10. After performing an audit, the independent CPA is still somewhat concerned that the financial statements are not free from all material misstatements. If, in the auditor’s judgment, the misstatements were material but not pervasive, the opinion expressed is likely to be:
11. For an audit of a nonissuer, which of the following paragraphs is found in a standard unmodified audit report?
I. Scope
II. Introductory
III. Management’s responsibility
IV. Auditor’s responsibility
12. If a publicly held company issues financial statements that purport to present its financial position and results of operations but omits the statement of cash flows, the auditor ordinarily will express:
13. An auditor would express an unmodified opinion with an emphasis-of-matter paragraph added to the auditor’s report for a:
I. justified change in accounting principle
II. material internal control weakness
14. Which of the following is an implicit representation when issuing the auditor’s report on comparative financial statements under US auditing standards?
I. Obtaining evidence that is sufficient and appropriate
II. Consistent application of accounting principles
15. Under GAAS, in the auditor’s responsibility paragraph, how does an auditor describe his or her responsibility regarding the client’s internal controls?
16. Where does a group auditor make reference to a component auditor in a division of responsibility?
I. Emphasis-of-matter paragraph
II. Other-matters paragraph
17. The inclusion of an emphasis-of-matter paragraph in the auditor’s report:
I. is used when referring to a matter that is not appropriately presented in the financial statements
II. does not affect the auditor’s opinion
18. When an auditor expresses a qualified opinion due to a material misstatement of the financial statements, the auditor’s responsibility paragraph should be amended to state that the auditor believes that the audit evidence obtained is sufficient and appropriate to provide a basis for the auditor’s:
19. An other-matters paragraph is used:
I. when required by GAAS
II. at the auditor’s discretion

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