The auditor's communication of material weaknesses in internal control for a nonpublic company is
A) Required to enable the auditor to state that the examination has been made in accordance with generally accepted auditing standards.
B) The principle reason for studying and evaluating the system of internal controls.
C) Incidental to the auditor's objective of forming an opinion as to the fair presentation of the financial statements.
D) Required to be documented in a formal written report to the board of directors or the board's audit committee.

Question

Quizplus · Accepted Answer

The auditor's communication of material weaknesses in internal control for a nonpublic company is incidental to the auditor's objective of forming an opinion as to the fair presentation of the financial statements. It is not required to enable the auditor to state that the examination has been made in accordance with generally accepted auditing standards. While studying and evaluating the system of internal controls is important, it is not the principle reason for the communication of material weaknesses. Communication of material weaknesses may be documented in a formal written report to the board of directors or the board's audit committee, but it is not expressly required.

The Auditor's Communication of Material Weaknesses in Internal Control for a Nonpublic