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Audit Report Modifications

In: Business and Management

Submitted By patch79
Words 1866
Pages 8
INDEPENDENT AUDITOR’S REPORT
Board of Directors, Stockholders, Owners, and/or Management of
Keystone Computers & Networks, Inc

We have audited the accompanying balance sheet of Keystone Computers & Networks, Inc. (the “Company”) as of December 31, 20XX and the related statements of income, retained earnings, and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.
The major audit issue involved will be determining that the client has properly categorized costs between research and development (those costs involved in establishing technological feasibility) and those costs that should be capitalized. The auditors will have to determine at what point the software product reached the point of technological feasibility.
We conducted our audit in accordance with auditing standards generally accepted in (the country where the report is issued). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
Furthermore, our ratio analysis showed no major changes. However, our audit did reveal that a number of the ratios show significant changes which seem due primarily to the increased level of profitability.
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company

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