Before reporting on the financial statements of a U.S. entity that have been prepared in conformity with another country's accounting principles, an auditor practicing in the U.S. should:
A.
Understand the accounting principles generally accepted in the other country.
B.
Be certified by the appropriate auditing or accountancy board of the other country.
C.
Notify management that the auditor is required to disclaim an opinion on the financial statements.
D.
Receive a waiver from the auditor's state board of accountancy to perform the engagement.
Suggested Answer:A🗳️
Choice "a" is correct. Before reporting on the financial statements of a U.S. entity that have been prepared in conformity with another country's accounting principles, the auditor practicing in the U.S. should understand the accounting principles generally accepted in the other country. Choice "b" is incorrect. The auditor practicing in the U.S. would be able to report on the financial statements of the U.S. entity without obtaining certification in the other country. Choice "c" is incorrect. The auditor need not disclaim an opinion on the financial statements prepared in conformity with another country's accounting principles. Choice "d" is incorrect. A waiver to perform the engagement is not necessary.
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