Snow, CPA, was engaged by Master Co., a privately-held company, to examine and report on management's written assertion about the effectiveness of Master's internal control over financial reporting. Snow's report should state that
A) Because of inherent limitations of any internal controls, errors or fraud may occur and not be detected.
B) Management's assertion is based on criteria established by the American Institute of Certified Public Accountants.
C) The results of Snow's tests will form the basis for Snow's opinion on the fairness of Master's financial statements in conformity with GAAP.
D) The purpose of the engagement is to enable Snow to plan an audit and determine the nature, timing, and extent of tests to be performed.

Question

Quizplus · Accepted Answer

This statement is a required element of any report on internal control over financial reporting in accordance with auditing standards. It acknowledges that no system of internal controls can provide absolute assurance that errors or fraud will be detected.

Snow, CPA, Was Engaged by Master Co