In connection with a proposal to obtain a new client, an accountant in public pr

Question

In connection with a proposal to obtain a new client, an accountant in public practice is asked to prepare a written report on the application of the requirements of an applicable financial reporting framework to a specific transaction. The accountant's report should include a statement that: (Points : 3)       

Any difference in the facts, circumstances, or assumptions presented may change the report.
       The engagement was performed in accordance with Statements on Standards for Consulting Services.
       The guidance provided is for management use only and may not be communicated to the prior or continuing auditors.
       Nothing came to the accountant's attention that caused the accountant to believe that the financial reporting framework violated GAAP.

Explanation / Answer

Ans Any difference in the facts, circumstances, or assumptions presented may change the report

The reporting accountant report on application of the requirement of an applicable financial reporting framework must include facts and circumstances differ from those which are presented to the accountant, so the accontant report may change based on these facts/assumptions/circumstances.

Other options are incorrect b) the engagement must be performed in accordance with AICPA standards c) the guidance provided is not only for the management use and it may be communicated to auditors.

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