In the course of the audit of financial statements for the purpose of expressing an opinion thereon,the auditors will normally prepare a schedule of unadjusted differences for which the auditors did not propose adjustment when they were identified.What is the primary purpose served by this schedule?
A)To point out to the responsible client officials the errors made by various company personnel.
B)To summarize the adjustments that must be made before the company can prepare and submit its federal tax return.
C)To identify the potential financial statement effects of misstatement or disputed items that were considered immaterial when discovered.
D)To summarize the misstatements made by the company so that corrections can be made after the audited financial statements are released.

Question

Quizplus · Accepted Answer

The primary purpose of the schedule of unadjusted differences is to identify the potential financial statement effects of misstatement or disputed items that were considered immaterial when discovered. This information is important to ensure that the financial statements are fairly presented and that users can rely on the information provided. The schedule is not intended to point out errors made by company personnel or summarize misstatements made by the company, and it is not directly related to the company's federal tax return.

In the Course of the Audit of Financial Statements for the Purpose