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a. How does the information in the preceding paragraphs compare to the information in the Basis
for Opinion and Auditor’s Responsibility sections in the standard unmodified opinion audit
report example for a nonpublic company shown in Figure 3-1 (p. 49)?
Both the preceding paragraphs and the information in Figure 3-1 are conducting the audit in
accordance with the appropriate governance body. Both refer to the auditor’s responsibilities
and both state independency of the company audited. They both are similar in that their duty to
obtain reasonable assurance that the financial statements are fairly presented and free of
material misstatements. Both state there is sufficient evidence to provide basis for opinion.
b. How does the information in the preceding paragraphs compare to the information in the Basis
for Opinion section in the standard unmodified opinion audit report example for a public
company shown in Figure 3-3 (p. 54)?
The Basis for Opinion paragraph is very similar to the comparison above. The Auditor’s
Responsibilities paragraph in Figure 3-3 presents a list auditor’s responsibilities in accordance
with GAAS, which include the following:
b. Discuss which of the three audit reports, in your opinion, provides greater auditor
communications to users of the financial statements.
I think the audit report in Figure 3-3 provides greater auditor communication to the users, as it
specifically communicates auditor’s responsibilities and what they’re based on. Not every user
of the financial statement fully understands auditors’ responsibilities, therefore providing such
information is useful for those users.