The use of opinion units allows the auditor to
A) Plan the audit better and increase the effectiveness of substantive procedures.
B) Eliminate the need for Test of Controls.
C) Provide different opinions on different components of the reporting entity.
D) Only allow one opinion for entire entity not its components.

Question

Quizplus · Accepted Answer

In any audit engagement, the auditor must determine a level of materiality. This determination is then used to plan, perform, and evaluate the results of audit procedures. Because of the various levels of reporting by governments government-wide, fund-type and individual fund), separate materiality evaluations are needed for the different levels of reporting. Opinion units allow the auditor to give different opinions on components of the reporting entity.

The Use of Opinion Units Allows the Auditor to