An auditor includes a separate paragraph in an otherwise unmodified report to emphasize that the entity being reported on had significant transactions with related parties. The inclusion of this separate paragraph
A) Is considered an "except for" qualification of the opinion.
B) Violates generally accepted auditing standards if this information is already disclosed in footnotes to the financial statements.
C) Necessitates a revision of the opinion paragraph to include the phrase "with the foregoing explanation."
D) Is appropriate and would not negate the unqualified/unmodified opinion.

Question

Quizplus · Accepted Answer

The inclusion of a separate paragraph to emphasize significant transactions with related parties is considered an appropriate and necessary disclosure, and would not negate an unmodified opinion. It may also be required by auditing standards depending on the circumstances.

An Auditor Includes a Separate Paragraph in an Otherwise Unmodified