Typically, when a going concern issue exists the auditor should:
A) Issue an unmodified opinion with an emphasis-of-matter paragraph
B) Issue a modified opinion and explain the reasons for the going concern issue
C) Issue a disclaimer of opinion
D) Withdraw from the engagement

Question

Quizplus · Accepted Answer

When a going concern issue exists, the auditor should evaluate the client's ability to continue as a going concern for a reasonable period of time. If significant doubts exist, the auditor should issue an unmodified opinion with an emphasis-of-matter paragraph that highlights the issue. This emphasizes that there is an uncertainty in the financial statements but does not affect the auditor's opinion on the accuracy of the financial statements. A modified opinion would be appropriate if there has been a material misstatement in the financial statements. A disclaimer of opinion would be appropriate if the auditor is unable to obtain sufficient evidence on which to base an opinion. Withdrawing from the engagement would only be appropriate if there is a conflict of interest or other ethical breach. Therefore, the best choice in this scenario is A) Issue an unmodified opinion with an emphasis-of-matter paragraph.

Typically, When a Going Concern Issue Exists the Auditor Should