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"Taken as a Whole"

Applies not only to current period statements but also to any prior statements presented for comparison

The auditor should update reports on financial statements previously issued

What does it mean to update a prior year's financial statement?

Update can mean reaffirm or change because of changed conditions or information coming to the auditor's attention during the current examination

Sample Report : Unqualified Prior year with current year qualified

(Reporting with different Opinions)

Same Intro Paragraph
Same Scope Paragraph
Middle paragraph before Opinion Paragraph
Opinion paragraph
**b/c Qualified Opinion use words "Except For"

Sample Report: Unqualified Current Year with Disclaimer on Prior Years' I/S, RE, and Cash Flows

(Reporting with different Opinions)

Same Intro paragraph

Scope Paragraph -- "Except for"
Insert Middle paragraph
Disclaimer on prior year's financial statements stated in middle paragraph
**Middle paragraph is before the opinion paragraph

Unqualified current year paragraph --refers to specific financial sheets

The auditor is in essence facing a scope limitation. The beginning balances may no longer be ascertainable (like a scope limitation)

Format of Updated Reports : Ammended Opinion Due to Restatement of Prior Year's Financials

DORCS --Middle paragraph before opinion paragraph

Date of audtior's previous report
Opinion type previously issued
Reason for the prior opinion
Changes that have occured
Statement that the " different"

Report of Predecessor Auditor : Presented

In deciding whether to reissue a predecessor's auditor should:
1) Read the statements for the current period
2) Compare the statements audited with the current period statements
3) Obtain a representation letter from the successor auditor
4) Obtain a letter of representation from management

Date of report:
1) Unrevised - original report date
2) Revised - dual date

Report of a predecessor Auditor : Not presented

The introductory paragraph of the predecessor should include:

1) That the statements were examined by other auditors in prior periods. (The predecessor auditor should remain nameless unless the practice was acquired or merged with that successor).
2) the date of the predecessor's report
3) The type of the opinion expressed
4) The substantive reasons for other unqualified report

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