ABC Auditors are auditing Jersey Charities, which is incorporated as a not-for-profit charitable organization. The fiscal year-end is June 30, 20X0. The auditors concluded their work on July 15^th, 20X0 and dated their audit report on that date. On July 20th, a major donor declared bankruptcy, leaving in serious doubt collection by Jersey of material pledges owed. The auditors should: A) recall the audit report and re-issue a new one. B) issue an amendment to the audit report dated July 20^th. C) determine if the financial statements have been made available. D) depending on the circumstances, the auditor may choose any of the above.

Question

Quizplus · Accepted Answer

The auditors should determine if the financial statements have been made available to users. If they have not, the auditors may consider adjusting the financial statements or including a disclosure about the event. If they have been made available, the auditors typically do not need to recall or amend the report unless the event significantly affects the financial statements.

ABC Auditors Are Auditing Jersey Charities, Which Is Incorporated as a Not-For-Profit