QUESTION: 132
Which of the following phrases should be included in the opinion paragraph when an auditor
expresses a qualified opinion?
A. Option A
B. Option B
C. Option C
D. Option D

Answer(s): D
Explanation:
Choice "d" is correct. No No.
A qualified opinion phrase is, "in our opinion, except for [Explanation of problem] as discussed
in the preceding paragraph . . ."
Choice "a" is incorrect, as "when read in conjunction with Note X" is not a phrase included in the
opinion paragraph of a qualified opinion.
Choice "b" is incorrect, as "with the foregoing Explanation" is not a phrase included in the
opinion paragraph of a qualified opinion.
Choice "c" is incorrect. Neither phrase is included in the opinion paragraph of a qualified
opinion. (This is why it's important to memorize the qualifying phrases as wel as the standard
independent auditor's report.)
QUESTION: 133
Which of the following procedures would an auditor most likely perform to obtain evidence about
the occurrence of subsequent events?

A. Recomputing a sample of large-dol ar transactions occurring after year-end for arithmetic
accuracy.
B. Investigating changes in stockholders' equity occurring after year-end.
C. Inquiring of the entity's legal counsel concerning litigation, claims, and assessments arising
after yearend.
D. Confirming bank accounts established after year-end.

Answer(s): C
Explanation:
Choice "c" is correct. The auditor would most likely inquire of the entity's legal counsel
concerning litigation, claims and assessments arising after year-end in order to obtain evidence
about the occurrence of subsequent events. Claims arising after year-end might well impact the
year-end financial statements. Choice "a" is incorrect. Recomputing a sample of large-dol ar
transactions occurring after year-end for arithmetic accuracy would not provide evidence about
year-end amounts. Choice "b" is incorrect. The auditor would inquire about changes in

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