In reviewing the financial statements of a nonissuer, an accountant is required to modify the standard review report for which of the following matters?

Question

Quizplus · Accepted Answer

Choice "D" is correct. Modifications are made to the standard review report only when there is a departure from generally accepted accounting principles. Neither an inability to assess risk nor a discovery of internal control deficiencies constitutes a departure from GAAP, and therefore neither would result in a modified review report. Note that assessing the risk of material misstatement due to fraud is a requirement of an audit, not a review. Also, note that testing of internal control is not required in a review of financial statements of a nonissuer. Choices "A", "B", and "C" are incorrect, based on the above Explanation.

In Reviewing the Financial Statements of a Nonissuer, an Accountant