11/16/25, 9:37 PM CPA - AUD
CPA – AUD NEWEST VERSION 2026 \COMPLETE
QUESTIONS AND ACCURATE DETAILED ANSWERS
\VERIFIED 100%\ACTUAL EXAM 2025 -2026
\LATEST UPDATE \GRADED A+
- Describes a justified change in accounting principle
that has a material effect on FS or change in reporting
EOM paragraph required
entity in the CURRENT YEAR
when... (nonissuer)
- Subsequently disclosed facts that lead to a change in
audit opinion (can also be other matter)
- FS are prepared in accordance w special purpose framework
EOM paragraph regarding Should refer the user of report to the FS note that
special purpose framework discusses the change of accounting principle in detail
- Auditor includes an alert in audit report that restricts the use of
the report
Other matter paragraph - Subsequently discovered facts that lead to change in opinion
required when... (can also be an EOM)
- FS of prior period was audited by another firm
- CY FS audited and presented with FS from PY that were
reviewed or compiled
If PY FS were MM, but Change their previously issued opinion, and if are used
have been updated to comparatively add an EOM paragraph to CY report discussing
conform w GAAP, change in opinion
auditor should...
For comparative FS, if Add an other matter paragraph explaining that PY auditor issued
PY audit report is not an unmodified opinion of FS
presented, CY auditor
should
- Read FS of current period
- Compare stmts audited w PY FS
Before reissuing PY
- Obtain letter of rep from successor auditor & client mgmt
auditors report,
predecessor auditor - Date report as either unrevised (original date, no
should... opinion change) or revised (opinion change, dual
dated)
/ 1/31
,11/16/25, 9:37 PM CPA - AUD
1) statements were audited by predecessor auditor
Successor auditor should 2) Type of opinion expressed by predecessor auditor,
indicate ______ when and why it was modified (if necessary)
3) Nature of any EOM in PY report
predecessor auditor
4) Date of predecessor auditor report
report is not presented
Requirements in order to - Component auditors report is not restricted in use
reference component - Component auditor performed audit in conformance w GAAS
auditor
If you choose to divide You do not need to review their work
responsibility w component
auditor
Nonrecognized subsequent Disclosed in FS but not accrued
events
- Review post balance sheet transactions
Actions auditor should take - Inquiry of clients legal counsel
to review for subsequent - Review minutes of board of directors meeting
events - Examine latest available interim FS and compare them to FS
under audit
First step to take when Determine whether there are people relying on FS who
finding out about facts would attach importance to the issue, and if there are
after audit report date then request mgmt to reissue the FS
that would have affected
report...
If auditor becomes aware Auditor needs to inquire about previously issued FS
of material info that existed
at the date of auditors First step is to discuss w mgmt
report, and would have
affected the report...
If mgmt refuses to make a Auditor should go to board, if board refuses then
subsequent event auditor should find people who rely on FS and alert
adjustment them that they should no longer be relied upon
Issuers version of EOM/other Explanatory paragraph
matter paragraph
How should auditor treat Apply limited procedures and add a separate section to auditors
required supplemental info report
Auditors responsibility Read over the other information to ensure that it is consistent
regarding other information with audited FS
/ 2/31
,11/16/25, 9:37 PM CPA - AUD
(like annual reports)
If client refuses to change info Auditor should communicate this w those charged w governance
in their other material
Materiality level for Should be the same as that for audit of FS
supplemental info
If supplemental info Auditor can say that supplemental info is fairly stated in
accompanying FS was all material respects to FS as a whole
subject to audit
procedures
Audits of special Mgmt responsibility section should describe that mgmt
frameworks, mgmt is responsible for determining that the basis of
responsibility section accounting is appropriate
Include a stmt that says the basis of accounting is a
Audit report for special
frameworks state comprehensive basis other than GAAP, DO NOT
explain the difference between GAAP and the
special basis
Other basis of accounting FS Cannot shares the same titles as GAAP FS
titles
/ 3/31
, 11/16/25, 9:37 PM CPA - AUD
Critical audit matter section follows basis for opinion section
location in audit report
FOR ISSUERS; required in audit report, especially
Critical audit matters
challenging or complex areas of audit, DOES NOT
modify the opinion
Key audit matters FOR NONISSUERS; not required in audit report, does not modify
the opinion
- Objective and scope of audit
- Responsibility of auditor
- Responsibility of mgmt
Requirements in engagement
- stmt that MM may go undetected
letters
- Identification of applicable fin reporting framework
- Reference to expected form and contents of any reports issued
by auditor
Client permission is needed before you speak with PY
Speaking w predecessor
auditor requires... auditor; CY auditor should review PY auditors WP and
inquire PY auditor
- Firms ability to meet reporting deadlines
- Firms ability to staff the engagement
Required preconditions in
- Independence
order to accept audit - Integrity of client Mgmt
- Permission from client to speak to PY auditor
Major red flag in accepting an Client imposed scope restrictions
audit
Mgmt responsibility Mgmt DOES NOT have to correct any weaknesses in IC
regarding auditors recognized by auditor
identified weakness in IC
Other contents of Identifying use of other auditors, specialists, internal auditors, or
engagement letter staff of the entity
Client wants to change - Makes no mention of scope limitation that caused the change
from audit to review/comp, - audit procedures already performed
and auditor believes that it is - Original engagement details
justified, audit report...
If PY auditor refuses to allow CY auditor should review risk assessment regarding opening
CY auditor access to balances of FS
documentation...
/ 4/31
CPA – AUD NEWEST VERSION 2026 \COMPLETE
QUESTIONS AND ACCURATE DETAILED ANSWERS
\VERIFIED 100%\ACTUAL EXAM 2025 -2026
\LATEST UPDATE \GRADED A+
- Describes a justified change in accounting principle
that has a material effect on FS or change in reporting
EOM paragraph required
entity in the CURRENT YEAR
when... (nonissuer)
- Subsequently disclosed facts that lead to a change in
audit opinion (can also be other matter)
- FS are prepared in accordance w special purpose framework
EOM paragraph regarding Should refer the user of report to the FS note that
special purpose framework discusses the change of accounting principle in detail
- Auditor includes an alert in audit report that restricts the use of
the report
Other matter paragraph - Subsequently discovered facts that lead to change in opinion
required when... (can also be an EOM)
- FS of prior period was audited by another firm
- CY FS audited and presented with FS from PY that were
reviewed or compiled
If PY FS were MM, but Change their previously issued opinion, and if are used
have been updated to comparatively add an EOM paragraph to CY report discussing
conform w GAAP, change in opinion
auditor should...
For comparative FS, if Add an other matter paragraph explaining that PY auditor issued
PY audit report is not an unmodified opinion of FS
presented, CY auditor
should
- Read FS of current period
- Compare stmts audited w PY FS
Before reissuing PY
- Obtain letter of rep from successor auditor & client mgmt
auditors report,
predecessor auditor - Date report as either unrevised (original date, no
should... opinion change) or revised (opinion change, dual
dated)
/ 1/31
,11/16/25, 9:37 PM CPA - AUD
1) statements were audited by predecessor auditor
Successor auditor should 2) Type of opinion expressed by predecessor auditor,
indicate ______ when and why it was modified (if necessary)
3) Nature of any EOM in PY report
predecessor auditor
4) Date of predecessor auditor report
report is not presented
Requirements in order to - Component auditors report is not restricted in use
reference component - Component auditor performed audit in conformance w GAAS
auditor
If you choose to divide You do not need to review their work
responsibility w component
auditor
Nonrecognized subsequent Disclosed in FS but not accrued
events
- Review post balance sheet transactions
Actions auditor should take - Inquiry of clients legal counsel
to review for subsequent - Review minutes of board of directors meeting
events - Examine latest available interim FS and compare them to FS
under audit
First step to take when Determine whether there are people relying on FS who
finding out about facts would attach importance to the issue, and if there are
after audit report date then request mgmt to reissue the FS
that would have affected
report...
If auditor becomes aware Auditor needs to inquire about previously issued FS
of material info that existed
at the date of auditors First step is to discuss w mgmt
report, and would have
affected the report...
If mgmt refuses to make a Auditor should go to board, if board refuses then
subsequent event auditor should find people who rely on FS and alert
adjustment them that they should no longer be relied upon
Issuers version of EOM/other Explanatory paragraph
matter paragraph
How should auditor treat Apply limited procedures and add a separate section to auditors
required supplemental info report
Auditors responsibility Read over the other information to ensure that it is consistent
regarding other information with audited FS
/ 2/31
,11/16/25, 9:37 PM CPA - AUD
(like annual reports)
If client refuses to change info Auditor should communicate this w those charged w governance
in their other material
Materiality level for Should be the same as that for audit of FS
supplemental info
If supplemental info Auditor can say that supplemental info is fairly stated in
accompanying FS was all material respects to FS as a whole
subject to audit
procedures
Audits of special Mgmt responsibility section should describe that mgmt
frameworks, mgmt is responsible for determining that the basis of
responsibility section accounting is appropriate
Include a stmt that says the basis of accounting is a
Audit report for special
frameworks state comprehensive basis other than GAAP, DO NOT
explain the difference between GAAP and the
special basis
Other basis of accounting FS Cannot shares the same titles as GAAP FS
titles
/ 3/31
, 11/16/25, 9:37 PM CPA - AUD
Critical audit matter section follows basis for opinion section
location in audit report
FOR ISSUERS; required in audit report, especially
Critical audit matters
challenging or complex areas of audit, DOES NOT
modify the opinion
Key audit matters FOR NONISSUERS; not required in audit report, does not modify
the opinion
- Objective and scope of audit
- Responsibility of auditor
- Responsibility of mgmt
Requirements in engagement
- stmt that MM may go undetected
letters
- Identification of applicable fin reporting framework
- Reference to expected form and contents of any reports issued
by auditor
Client permission is needed before you speak with PY
Speaking w predecessor
auditor requires... auditor; CY auditor should review PY auditors WP and
inquire PY auditor
- Firms ability to meet reporting deadlines
- Firms ability to staff the engagement
Required preconditions in
- Independence
order to accept audit - Integrity of client Mgmt
- Permission from client to speak to PY auditor
Major red flag in accepting an Client imposed scope restrictions
audit
Mgmt responsibility Mgmt DOES NOT have to correct any weaknesses in IC
regarding auditors recognized by auditor
identified weakness in IC
Other contents of Identifying use of other auditors, specialists, internal auditors, or
engagement letter staff of the entity
Client wants to change - Makes no mention of scope limitation that caused the change
from audit to review/comp, - audit procedures already performed
and auditor believes that it is - Original engagement details
justified, audit report...
If PY auditor refuses to allow CY auditor should review risk assessment regarding opening
CY auditor access to balances of FS
documentation...
/ 4/31
