A client has omitted a significant disclosure from the financial statements.The auditor has asked the client to include the information,but the client refuses and claims the information is confidential.The position of the CPA should be that the information
A) Cannot be considered confidential if it is necessary to the completeness of the financial statements.
B) Cannot be considered confidential unless it can be covered by the attorney-client privilege.
C) Is confidential and will be disclosed only under subpoena or for a regulatory investigation.
D) Should be discussed with the audit committee to determine whether the information should be disclosed.

Question

Quizplus · Accepted Answer

As an auditor, it is the responsibility to ensure that the financial statements are complete and accurate. If the omitted disclosure is necessary for the completeness of the financial statements, the auditor cannot consider it confidential and should insist that it be disclosed. The auditor should discuss the matter with the client and educate them on the importance of full disclosure in financial reporting. If the client still refuses to disclose the information, the auditor should consider the impact of the omission on the financial statements and take appropriate action, which may include qualifying the audit opinion or withdrawing from the engagement.

A Client Has Omitted a Significant Disclosure from the Financial