a client prepared document, the report should include an opinion on the information but should
not describe the character of the audit work performed.

Answer(s): C
Explanation:
Choice "c" is correct. If an auditor chooses to report on information accompanying the basic
financial statements in a client-prepared document, the report should include a description of
both the character of the audit work performed and the degree of responsibility assumed.
Choice "a" is incorrect. There is no requirement that the auditor be specifically engaged to
report on such information. If auditing procedures have been applied to the information, the
auditor is permitted to report thereon. Choice "b" is incorrect. The auditor is permitted but not
required to report on such information. Choice "d" is incorrect. If an auditor chooses to report on
information accompanying the basic financial statements in a client-prepared document, the
report should include an opinion on the information and a description of both the character of
the audit work performed and the degree of responsibility assumed.
QUESTION: 106
Which of the following reporting options is least likely with regard to supplementary information
that is required by GAAP?

A. The auditor's report on the financial statements makes no reference to the supplementary
information.
B. A disclaimer of opinion is issued on supplementary information that is not clearly
distinguished from the financial statements and is not marked "unaudited."
C. The auditor's report on the financial statements includes both an opinion on the
supplementary information and a statement restricting the use of the report.
D. The auditor's report on the financial statements includes an opinion regarding whether the
supplementary information is fairly stated in all material respects in relation to the financial
statements taken as a whole.

Answer(s): C
Explanation:
Choice "c" is correct. There is no requirement that the auditor's report on supplementary
information required by GAAP be restricted. Choice "a" is incorrect. An auditor is not required to
audit supplementary information, and in such cases the auditor's report on the basic financial
statements would not generally include a reference to such information. Choice "b" is incorrect.
When supplementary information that is not clearly distinguished from the financial statements
is not marked "unaudited," the auditor would generally issue a disclaimer on that information.
Choice "d" is incorrect. When the auditor chooses to apply auditing procedures to the
supplementary information, he or she may express an opinion regarding whether the
supplementary information is fairly stated in all material respects in relation to the financial
statements taken as a whole.
QUESTION: 107
When an auditor submits a document containing audited financial statements to a client, and
those financial statements include supplementary information required by GAAP, the auditor
may choose any of the following options, except:

A. Express an opinion on the information, if he or she has been engaged to examine such

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