Chapter 3

The report a CPA issues when all auditing conditions have been met, no significant misstatements have been discovered and left uncorrected, and it is the auditor's opinion that the financial statements are fairly stated in accordance with the applicable financial reporting framework.

A misstatement in the financial statements, knowledge of which would affect a decision of a reasonable user of the statements.

Those matters that, in the auditor's professional judgment, were of most significance in the audit of financial statements of the current period of a nonpublic entity, and they are selected from matters communicated with those charged with governance.

Those matters during the audit of a public company that involved difficult, subjective, or complex auditor judgments or that posed difficulty to the auditor in obtaining sufficient appropriate evidence or in forming the opinion on the financial statements.

Audit report on the effectiveness of internal control over financial reporting required for larger public companies under Section 404 of the Sarbanes-Oxley Act that cross-references the separate audit report on the financial statements.

Audit report on the financial statements and the effectiveness of internal control over financial reporting for larger public companies under Section 404 of the Sarbanes-Oxley Act.

An unmodified opinion audit report in which the financial statements are fairly presented, but the auditor believes it is important or is required to provide additional information or the wording of other paragraphs of the report require revision.

A report issued when the auditor believes that the overall financial statements are fairly stated but that either the scope of the audit was limited or the financial data indicated a failure to follow GAAP.

A report issued when the auditor believes the financial statements are so materially misstated or misleading as a whole that they do not present fairly the entity's financial position or the results of its operations and cash flows in conformity with GAAP.

A report issued when the auditor is not able to become satisfied that the overall financial statements are fairly presented or the auditor is not independent.

A misstatement that affects multiple elements of the financial statements, an account that is a significant portion of the financial statements, or a disclosure that is fundamental to understanding the financial statements.