Question

An auditor may report on summary financial statements that are derived from a complete set of audited financial statements only if the auditor

Multiple Choice
a. presents the summary financial statements in comparative form with the prior years' summary financial statements.
b. expresses an unmodified opinion on the audited financial statements from which the summary financial statements are derived.
c. determines that the summary financial statements include all the disclosures necessary for the complete set of financial statements.
d. Indicates whether the information is fairly stated in all material respects in relation to the complete financial statements.

Answer 1

An auditor can report on summary financial statements if they indicate whether the information is fairly stated in all material respects to the audited financial statements. Option B is correct.

Step-by-step explanation:

An auditor may report on summary financial statements that are derived from a complete set of audited financial statements only if the auditor indicates whether the information is fairly stated in all material respects in relation to the complete financial statements.

This requirement is critical to ensure that readers of the summary financial statements receive an accurate representation of the audited financial statements from which they are derived. The auditor's responsibility includes determining whether the summary financial statements fairly present, in all material respects, the information from the audited financial statements in a condensed form.

An auditor may report on summary financial statements that are derived from a complete set of audited financial statements only if the auditor expresses an unmodified opinion on the audited financial statements from which the summary financial statements are derived. This means that the auditor must provide a positive assessment of the accuracy and fairness of the audited financial statements. Option b is the correct answer.