[runhomejack]

Hi, I have AUD tomorrow and just wanted to start a thread for last minute things I am not understanding. Feel free to reply with your own questions

1. This is a Wiley MCQ I don’t agree with:

Q: When an auditor qualifies an opinion because of inadequate disclosure, the auditor should describe the nature of the omision in a separate explanatory paragraph and modify the…

A: Opinion paragraph only.

Isn’t inadequate disclosure the same as a scope limitation meaning the scope paragraph should be modified in addition to the opinion paragraph and the explanatory paragraph?

BEC - Pass
FAR - Pass
REG - Pass
AUD - Pass

[Anonymous]

My understanding of Inadequate disclosure that results in a qualified opinion (or adverse depending on materiality) is that a middle paragraph before the opinion is used to disclose the missing information and the opinion paragraph will refer to the above paragraph.

You have it right however you were not reading the question correctly. The question already states

“the auditor should describe the nature of the omision in a separate explanatory paragraph…”

[Roxwella]

Inadequate disclosure means a departure from GAAP, not a scope limit. They were required to spell out certain things in the disclosures, but failed to do so (they are required to do this by GAAP). If we were talking about failure to disclose info to the auditor by management (which would be very odd wording) you would have a scope limitation. But in this case, the only people not getting the info are the users. I would suggest thinking about all the MC you covered and making a list of reasons to reach opinions (that are not necessarily tied to your understanding or memorization of GAAP .. the rules of which are numerous and difficult to memorize).

Scope = issues between management/events and auditor, that effect info (or type of info) auditor can inspect/receive

GAAP = issues between report and users (its conveyance of appropriate/useful info)

Also, problems in:

Scope—- Some=Qualified, Tons=Disclaimer

GAAP—- Some=Qualified, Tons=Adverse

(REMEMBER either can be qualified!)

Best Worst

Unqualified->Qualified->Adverse/Disclaimer

I know they are simple relationships, but in the baren rooms of prometric, it can be hard to remember everything.

[Author]

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