Which of the following scope limitations would ordinarily be of most concern to the auditors?
A)The inability to observe inventories because auditors were appointed following the date of the financial statements.
B)Management's refusal to provide auditors with written representations.
C)The inability to obtain confirmation of year-end balances from customers because of different billing dates.
D)The use of the work of component auditors in the audit of group financial statements.

Question

Quizplus · Accepted Answer

When management refuses to provide written representations, auditors are unable to obtain explicit and direct evidence about the completeness, accuracy, and validity of management's assertions. This could result in significant risks and material misstatements going undetected. The other scope limitations listed may also present challenges, but management's refusal to provide written representations is generally considered the most serious.

Which of the Following Scope Limitations Would Ordinarily Be of Most