[Anonymous]

there is a Becker Question:

If the auditor is unable to form an opinion on a new clients’ opening inventory balances, the auditor will issue an opinion on the closing balance sheet only and will issue a disclaimer of opinion on the statement of incomes, retained earning and cash flows.

Can anyone explain to me why auditor issues an opinion on closing balance sheet ONLY? or anyone is also using Becker book tell me which page I can refer to this question?

Many Thanks!!!!!

[Jennifer241]

Not knowing their beginning balance of inventory makes it impossible to verify their COGS accuracy. Therefore you would not be able to express an opinion on the Income Statement.

AUD - Jan 9,13 Pass
REG - Aug 30,13 Pass
BEC - Oct 26,13 Pass
FAR - Dec 4,13 Pass

Licensed CPA in the state of Oregon

[CPA Exam]

Remember, the Balance Sheet is a snapshot of all assets, liabilities, and equity at the end of the year. If the auditor can properly audit ending year inventory balances, the auditor then has enough information for the Balance Sheet relating to inventory.

The other financial statements though effective over a period of time. They are not merely a snapshot of the ending year balances in the accounts. Therefore, an auditor that is not able to form an opinion regarding beginning year inventory balances will be unable to form an opinion on the other three financial statements.

Audit: 97
BEC: 92
REG: 89
FAR: (8/30/2013)

[jsmithsae]

ditto what they other two posted…regarding the page to look at, when using the pass master software there is a book icon, i believe, in the top center. On each question you can click that and it will pull up the page in the text that pertains to the question you are on. Very helpful when trying to get down to the details.

BEC-75!
AUD-84!
REG-78!
FAR-83!
Ethics-Passed!
Experience-Got that too

Used Becker 2013 Self-Study & NINJA 10pt Combo Lite(AUD)

[Anonymous]

Thanks a lot for your reply!!!

[Author]

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