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What type of audit opinion should be issued

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Reference no: EM132543856

Point 1: Laughing Out Loud Auditing Limited has been engaged by Donkey Kong Electronics Limited to conduct a financial statement audit for the financial year ending December 31, 2020. Laughing Out Loud Auditing Limited were required to conduct a full audit of all the operations of Donkey Kong Electronics Limited.

Point 2: Financial statements provided to the engagement partner by Donkey Kong Electronics Limited indicated that for the 2020 financial year the company (i.e., Donkey Kong Electronics Limited) had sales revenue of $91,000,000, total assets of $80,000,000, total equity of $25,000,000 and net income of $14,120,000.

Point 3: The engagement partner disclosed that after all the respective tests conducted the audit team had only found some random errors. All errors related to the sales of the firm. The total value of the errors amounted to $210,000. The engagement partner reported that all but 3% of the planned tests had been completed.

Point 4: A major concern raised by the engagement partner from an interview with CFO of the company is that they were proposing in the future to use the Poll of Inventory Costing Method to value inventory. The company is very seriously pursuing this option.

Required:

Question 1: What type of audit opinion should be issued? Justify.

Reference no: EM132543856

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