King, CPA, was engaged to audit the financial report of Newton Company after its fiscal year had ended. King neither observed the inventory count nor confirmed the receivables by direct communication with debtors but was
Satisfied concerning both after applying alternative procedures. King's auditor's report most likely contained a(n):
A) unmodified opinion with an explanatory paragraph.
B) unmodified opinion.
C) disclaimer of opinion.
D) qualified opinion.

Question

Quizplus · Accepted Answer

The fact that King did not observe the inventory count or confirm the receivables by direct communication with debtors does not necessarily lead to a modified opinion. If King was satisfied with the alternative procedures he performed and gathered sufficient evidence to support his opinion, he would issue an unmodified (or "clean") opinion on the financial statements. Therefore, option B (unmodified opinion) is the most likely option.

King, CPA, Was Engaged to Audit the Financial Report of Newton