Types of Audit Opinions Subsequent to the date of the financial statements, as part of post-balance sheet date audit procedures, a CPA learned that a recent fire caused significant damage to one of the client's two manufacturing facilities. However, the
loss will not be reimbursed by insurance. Newspapers in the area describe the event in detail and the event is widely known. The financial statements and related notes as prepared by the client did not disclose the fire loss. REQUIRED: Which type of audit report would you suggest be issued this year and why?
Disclosure of this information is required in a footnote. According to the information, this event is highly material or material, depending upon the amount of the loss and the auditor's preliminary judgment about materiality. Failure to disclose the event is a violation of GAAP and is likely to result in a qualified opinion, or it could be so material that it requires an adverse opinion.
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Douglas obtained a $100,000 insurance policy on his warehouse. The policy contained an 80 percent coinsurance clause. An accidental fire totally damaged the building that had a fair market value of $250,000 at the time of the loss. How much will Douglas recover from his insurance company?
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A pallet position is a position where pallets are stored
Answer the following statement(s) true (T) or false (F)
Which of the following torts committed by an agent is the liability of the principal?
A) substantial frolic and detour B) accidents caused by an agent on the way to work C) accidents caused by an agent on the way from work D) negligence