The refusal by a client's lawyer to provide a representation about the legality of an act committed by the client is generally ________.
A)sufficient reason to issue an adverse opinion
B)considered to be a scope limitation
C)insufficient reason to modify the auditor's report due to the lawyer's obligation of confidentiality
D)proper grounds to withdraw from the engagement

Question

Quizplus · Accepted Answer

A lawyer's refusal to provide a representation about the legality of a client's act is considered a scope limitation because it restricts the auditor's ability to obtain sufficient evidence regarding the potential legal consequences of the act. However, it does not necessarily indicate that there is a material misstatement in the financial statements or a departure from GAAP, which would warrant an adverse opinion or modification of the auditor's report. Withdrawal from the engagement may be necessary if the limitation is pervasive and has a significant impact on the audit, but it should be a last resort.

The Refusal by a Client's Lawyer to Provide a Representation