An auditor is engaged to report on summary financial statements derived from audited financial statements. Which of the following is true?

Answer options:

The auditor can report on summary statements without having audited the full statements.

The auditor provides positive assurance that the summary statements are fair in all material respects.

The auditor must have audited the full financial statements to report on the summary statements.

The report on summary statements must be an adverse opinion.

How to approach this question

Prerequisite: You must audit the Big Picture before you can sign off on the Snapshot.

Full Answer

C.The auditor must have audited the full financial statements to report on the summary statements.✓ Correct

The auditor must have audited the full financial statements to report on the summary statements.

The auditor can only report on summary financial statements if they audited the complete set of financial statements from which the summary was derived.

Common mistakes

Thinking summary statements are a standalone engagement.

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