Lawsuits that threaten the company with financial losses


Question: Bajada Paper Products is facing lawsuits that threaten the company with financial losses. Bajada Paper Products refused to disclose this in the notes to the financial statements. What is most likely would happen? Select answer from the options below The auditor would issue an unqualified opinion as long as the creditors and investors are being paid despite the financial loss. The auditor would modify the opinion for a material departure from the financial reporting framework. The auditor can still issue an unmodified report as long as the bankruptcy is filed after the audit report is issued. The auditor can still issue an unmodified report as long as the financial reporting complies with US GAAP.

 

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Accounting Basics: Lawsuits that threaten the company with financial losses
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