ACCA Strategic Professional · Advanced Audit and Assurance (International) · Audit-related and assurance services
Lumen Partners performs an assurance engagement on Harbor Foods' supply-chain ethics statement. Midway, the engagement partner finds that the client's records are incomplete and the evidence available is not sufficient to support a conclusion, and the limitation is pervasive. Management refuses to provide more. Which action is most appropriate for the practitioner's report?
The practitioner should disclaim a conclusion or withdraw from the engagement. Sufficient appropriate evidence is a required element, and a pervasive scope limitation means possible effects are both material and widespread. A qualified conclusion would suit only a non-pervasive limitation, and an adverse conclusion relates to misstatement rather than missing evidence.
- AIssue an unmodified conclusion and mention the incomplete records in an emphasis paragraph
- BExpress a qualified conclusion, since only some evidence is missing
- CDisclaim a conclusion or withdraw from the engagement, because the scope limitation is pervasiveCorrect
- DIssue an adverse conclusion, because the records are incomplete
Explanation
Where the practitioner cannot obtain sufficient appropriate evidence and the possible effects are material and pervasive, the practitioner disclaims a conclusion or withdraws where practicable. A qualified conclusion suits a limitation that is material but not pervasive. An adverse conclusion applies to misstatement, not to a lack of evidence.
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