Which of the following matters would an auditor most likely communicate to those charged with governance?

Question

Quizplus · Accepted Answer

Choice "D" is correct. The auditor should communicate the initial selection of, and changes in, significant accounting policies to those charged with governance. Choice "A" is incorrect. Negative trends and adverse financial ratios are evaluated by an auditor when considering an entity's ability to continue as a going concern. These trends and ratios are not required to be communicated to those charged with governance. Choice "B" is incorrect. The auditor's communications to those charged with governance include the level of responsibility that the auditor is assuming regarding matters of interest to those charged with governance, not the level of responsibility assumed by management. Choice "C" is incorrect. The auditor is required to inform the audit committee about difficulties encountered with management during the audit. Difficulties encountered in achieving a satisfactory response rate from the entity's customers in confirming accounts receivables generally would not be communicated to those charged with governance, since such difficulties are not related to management.

Which of the Following Matters Would an Auditor Most Likely