An auditor is engaged to report on summary financial statements derived from the audited financial statements of a nonissuer. The auditor issued an unmodified opinion on the full financial statements. Which of the following is a requirement for the auditor to accept the engagement to report on the summary financial statements?

Answer options:

The auditor must have been the auditor of the full financial statements.

The summary financial statements must include all footnotes from the full financial statements.

The auditor must issue a compilation report on the summary financial statements.

The auditor must obtain a new engagement letter for the full audit.

How to approach this question

Summary Financial Statements rule: You can't summarize what you didn't read. Only the original auditor can report on the summary.

Full Answer

A.The auditor must have been the auditor of the full financial statements.✓ Correct

AU-C 810 permits an auditor to report on summary financial statements only if the auditor has also audited the financial statements from which the summary statements are derived.

Common mistakes

Thinking any CPA can report on summary statements.

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