Delta Life Insurance Co.prepares its financial statements on an accounting basis insurance companies use pursuant to the rules of a state insurance commission.Wall,CPA,is Delta's auditor.If Wall discovers that the statements are not suitably titled,Wall should
A)disclose any reservations in an explanatory paragraph and qualify the opinion.
B)apply to the state insurance commission for an advisory opinion.
C)issue a special statutory basis report that clearly disclaims any opinion.
D)explain in the notes to the financial statements the terminology used.

Question

Quizplus · Accepted Answer

The auditor should disclose any reservations about the financial statements in an explanatory paragraph and qualify the opinion if the statements are not suitably titled, as this affects the fair presentation of the financial statements.