[win2bet]

In which of the following circumstances does an accountant not have a duty to disclose that fraud or noncompliance with laws and regulations may have occurred to parties outside of the entity?

A.

To comply with certain legal and regulatory requirements

B.

To a successor accountant in connection with his or her acceptance of an engagement to compile or review the financial statements of a nonissuer

C.

To a predecessor accountant so that he or she might notify any users who might still be relying on his or her report

D.

In response to a subpoena

The answer is C, because we are suppose to assume that mgmt gave the successor permission.

My rational for B: having a duty to give info to some1 trying to perform attest services is much less important than having a duty to give this info to a predecessor to help him do some damage control / inform ppl who are relying

REG 68,87
BEC 85
FAR 75
AUD 64,64, 86!

[SurfNY]

I think C is the right answer. “Not have a duty” is the key phrase here. There is no information regarding the time frame of the fraud taking place. Thus, one assumes that prior year's FS are correct. Predecessor's liability for an opinion issued on FS ends at the audit report's date. If fraud occurred between a bs date and report date prior year's FS would have to contain a disclosure. …please correct if wrong

REG - 82 05/26/15
FAR - 80 07/01/15
AUD - 82 08/31/15
BEC - .. 10/26/15

[win2bet]

@surf, i do see what your saying, makes sense. not sure about the dual date part

REG 68,87
BEC 85
FAR 75
AUD 64,64, 86!

[SurfNY]

Win2 u are correct. A dual date would be necessary if there was no adjustment to the FS and the subsequent event took place after report date but prior to issuance. Thanks

REG - 82 05/26/15
FAR - 80 07/01/15
AUD - 82 08/31/15
BEC - .. 10/26/15

[Author]

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