Which component of an unqualified opinion defines the concept of internal control over financial reporting (ICFR) and states inherent limitations of ICFR?
A)Definition and inherent limitations paragraph
B)Paragraph referencing the financial statement audit
C)Scope paragraph
D)Basis for opinion paragraph

Question

Quizplus · Accepted Answer

The definition and inherent limitations paragraph of an unqualified opinion defines the concept of internal control over financial reporting (ICFR) and also states the inherent limitations of ICFR. This paragraph is essential in providing an understanding of the framework used to evaluate the effectiveness of the company's internal control over financial reporting. The other paragraphs (referencing the financial statement audit, scope, and basis for opinion) provide information on the specific procedures performed during the audit, the extent of the audit, and the auditor's conclusion, but they do not directly address the concept of ICFR or its limitations.

Which Component of an Unqualified Opinion Defines the Concept of Internal