The fact that a client has a material accounting departure for failure to follow ASPE would require the accountant to disclose that fact in a separate paragraph giving rise to the modification when the accountant is performing

Question

Quizplus · Accepted Answer

According to the handbook section 5855, when an accountant becomes aware of a material departure from the ASPE in a review or an audit, they have to issue a qualified or adverse opinion. The opinion paragraph must include the phrase "except for the effects of the matter described in the preceding paragraph." Furthermore, the accountant should include a separate paragraph describing the nature of the material departure. Thus, the correct answer is B, which refers to both review and audit engagements.

The Fact That a Client Has a Material Accounting Departure