Rise to gaap departure or scope limitation

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Reference no: EM131265285

Realtor Ltd leases its property from a related company called RioCom Limited. RioCom is currently being audited. Your audit of the lease indicates that the rental terms are in excess of rental terms for similar buildings in the area. The amount is considered highly material. Management of RioCom refuses to disclose the relationship in the books.

Required

Explain, with reason(s), whether the situation described above gives rise to a GAAP departure or a scope limitation.

Explain with reason(s) the type of audit opinion that would be provided. Be sure to fully explain the impact on the changes to the standard audit report (unmodified)

Reference no: EM131265285

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