If there is a deviation in the statements' preparation in accordance with GAAP and another accounting principle was applied on a basis that was not consistent with that of the preceding year,
A) the auditor must choose which modification to include in the audit report.
B) only the most material modification can be disclosed.
C) more than one modification should be included in the report.
D) none of the above.

Question

Quizplus · Accepted Answer

If there is a deviation in the preparation of statements from GAAP and another accounting principle is applied on a basis that is not consistent with the preceding year, then it would require multiple modifications to the audit report. Therefore, more than one modification should be included in the report. The auditor should disclose all the material modifications in their report to provide transparency and clarity to the users of the financial statements.

If There Is a Deviation in the Statements' Preparation in Accordance