3- 26 (a-c)

a. Identify which of the conditions requiring a deviation from a standard unmodified opinion audit
report is applicable, if any.
1. Substantial doubt about going concern
2. Failure to follow GAAP
3. None
4. Change in accounting principle
5. None
6. Report involving other auditors
b. State the level of materiality as immaterial, material, or highly material. If you cannot decide the
level of materiality, state the additional information needed to make a decision.
1. Material or highly materials
2. Material
3. Material
4. Material
5. Additional information needed
6. Additional information needed
c. Given your answers in parts a. and b., state the appropriate audit report from the following
alternatives (if you have not decided on one level of materiality in part b., state the appropriate
report for each alternative materiality level):
1. Unmodified opinion—explanatory paragraph
2. Qualified opinion only—GAAP departure
3. Unmodified opinion—nonstandard report wording
4. Unmodified opinion—explanatory paragraph
5. Unmodified opinion—standard wording
6. Unmodified opinion—nonstandard report