The audit firm issues an audit report for its client. The auditors have no obligation to make further inquiries with respect to the client's audited financial statements unless
A) a development occurs that may affect the company's long-term viability as a company.
B) final resolution was made on disclosed contingency for which no liability needed to be accrued.
C) new information comes to the auditor's attention concerning an event that occurred prior to the date of the audit report that, if known, would have impacted the audit opinion.
D) a lawsuit, in which the risk of loss was considered remote, was resolved in the company's favor.

Question

Quizplus · Accepted Answer

Auditors have a responsibility to consider new information that comes to their attention regarding events that occurred before the date of the audit report if such information would have affected their audit opinion. This is because such information could potentially alter the financial statements' accuracy or the audit report's conclusions.

The Audit Firm Issues an Audit Report for Its Client