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Explain audit report options and what audit opinion adopt

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Reference no: EM132825587

Your audit client is an investment company that specialises in investing in energy market derivates and instruments that are traded in foreign markets. The investments are difficult to value and you have obtained two independent valuations which show that the assets may be overvalued in the balance sheet.

  • During the year, you have had issues with the CEO who has been difficult and he is vehemently opposed to any asset write-downs that are being suggested. In prior years, the market has been good and there has been no need for any write-downs. The write-downs will cause the company to have a significant loss in that year. The CEO has the backing of the board. After presenting the suggested asset write-downs to the CEO and board, they are refusing to amend the accounts to reflect the lower values and threatening to change auditors next year.

Required

Problem A) What ethical issues do you face?

Problem b) Explain your audit report options. What audit opinion would you adopt?

Reference no: EM132825587

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