Chapter 6.4, Problem 1.2CQ

Inquiry and observation are applicable to gather evidence about a policy or procedures that does not provide documentary evidence.   TRUE OR FALSE? WHY?

Are there any reasons to question the validity of the CAPM?Explain.

How does the auditor’s opinion differ between scope limitationscaused by client restrictions and limitations resulting from conditions beyond the client’scontrol? Under which of these two will the auditor be most likely to issue a disclaimer ofopinion? Explain.

What procedures should be performed to determine the adequacy of the allowance for doubtfulaccounts?

Why or what are the reason or reasons that would cause the trial balance to be considered as unadjusted?

How is the auditors’ standard (unmodified) report modified for qualified or adverse opinionsissued as a result of departures from GAAP?

Which statement is incorrect in the measurement of a provision? *a. The risks and uncertainties that inevitably surround many events and circumstances shall be taken into account in reaching the best estimate of a provisionb. Where the effect of the time value of money is material, the amount of a provision shall be the present value of the expenditure expected to settle the obligationc. Future events that may affect the amount required to settle the obligation shall be reflected in the amount of the provision where there is sufficient objective evidence that the future events will occurd. Gains from expected disposal of assets shall be taken into account in measuring a provision