An auditor may report on summary financial statements that are derived from a complete set of audited financial statements only if the auditor
A)Expresses an unmodified opinion on the audited financial statements from which the summary financial statements are derived.
B)Indicates whether the information is fairly stated in all material respects in relation to the complete financial statements.
C)Determines that the summary financial statements include all the disclosures necessary for the complete set of financial statements.
D)Presents the summary financial statements in comparative form with the prior years' summary financial statements.

Question

Quizplus · Accepted Answer

According to the Statement on Standards for Attestation Engagements (SSAE) No. 10, an auditor may report on summary financial statements that are derived from a complete set of audited financial statements if the auditor indicates whether the information is fairly stated in all material respects in relation to the complete financial statements. The auditor must also include a reference to the audited financial statements from which the summary financial statements were derived, and the summary financial statements should include all the disclosures necessary for the complete set of financial statements. The option A is incorrect because expressing an unmodified opinion is not enough to report on summary statements. The option C is incorrect because including all the necessary disclosures is not enough without indicating that the information is fairly stated. The option D is incorrect because presenting the statements in comparative form is not a requirement for reporting on summary financial statements.

An Auditor May Report on Summary Financial Statements That Are