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AUDIT REPORT NORMALLY COVERS:
- BALANCE SHEET
- INCOME STATEMENT
- STATEMENT OF RETAINED EARNINGS
- STATEMENT OF CASH FLOWS
- RELATED FOOTNOTES
NOTE:
IF OTHER INFORMATION IS INCLUDED WITH THE FINANCIAL STATEMENTSTHE AUDITOR MUST READ IT TO DETERMINE WHETHER IT IS CONSISTENT WITH THE FINANCIAL STATEMENTS (OPINION DOES NOT COVER THIS OTHER INFORMATION).

IF AUDITOR SUBMITS FINANCIAL STATEMENTS CONTAINING THISOTHER INFORMATIONTHEN THE AUDITOR SHOULD EXPAND THE REPORT AND OPINION TO COVER THIS OTHER INFORMATION OR DISCLAIM AN OPINION ON THIS OTHER INFORMATION.


 
 



STANDARD REPORT
INDEPENDENT AUDITOR'S REPORT 1) TITLE 
- INDEPENDENT
TO THE STOCKHOLDERS OF ABC COMPANY 2) ADDRESSEE 
- GROUP THAT HIRES AUDITOR GENERALLY NOT MANAGEMENT
WE HAVE AUDITED THE ACCOMPANYING BALANCE SHEET OF ABC CORPORATION AS OF DECEMBER 31, 19x4, AND THE RELATED STATEMENT 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 STATEMENTS BASE ON OUR AUDIT. 3) INTRODUCTORY PARAGRAPH 
- WE HAVE AUDITED 
- LIST FINANCIAL STATEMENTS 
- INDICATED MANAGEMENT'S RESPONSIBILITY 
- INDICATED AUDITOR'S RESPONSIBILITY
WE CONDUCTED OUR AUDIT IN ACCORDANCE WITH GENERALLY ACCEPTED AUDITING STANDARDS. 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 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. 4) SCOPE PARAGRAPH 
- GAAS 
- REASONABLE ASSURANCE STATEMENTS ARE FREE OF MATERIAL MISSTATEMENT 
- EXAMINING ON A TEST BASIS EVIDENCE SUPPORTING AMOUNTS AND DISCLOSURES 
- ASSESSING ACCOUNTING PRINCIPLES USED AND SIGNIFICANT ESTIMATES MADE, AS WELL AS EVALUATING OVERALL PRESENTATION 
- AUDIT PROVIDES A REASONABLE BASIS FOR OUR OPINION 
IN OUR OPINION, THE FINANCIAL STATEMENTS REFERRED TO ABOVE PRESENT FAIRLY, IN ALL MATERIAL RESPECTS, THE FINANCIAL POSITION OF ABC CORPORATION AS OF DECEMBER 31, 19x4, AND THE RESULTS OF ITS OPERATIONS AND ITS CASH FLOWS FOR THE YEAR THEN ENDED IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. 5) OPINION PARAGRAPH 
- IN OUR OPINION 
- PRESENT FAIRLY, IN ALL MATERIAL RESPECTS 
- IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING
ANDERSON AND ZINDER, P.C., CPAs 6) SIGNATURE 
- FIRM
MARCH 5, 19x5 7) DATE 
- END OF FIELDWORK



DEPARTURES FROM STANDARD UNQUALIFIED AUDIT REPORT FOR
FINANCIAL STATEMENTS PREPARED IN ACCORDANCE WITH
GENERALLY ACCEPTED ACCOUNTING PRINCIPLES
UNQUALIFIED - SHARED RESPONSIBILITY 
- NON-GAAP AUDITOR CONCURS 
- MATERIAL UNCERTAINTIES** 
- GOING CONCERN 
- INCONSISTENCY IN GAAP 
- EMPHASIS OF A MATTER 
- CHANGE IN OPINION 
- PREDECESSOR REPORT NOT REISSUED
QUALIFIED - SCOPE RESTRICTION 
- NON-GAAP
DISCLAIMER - SCOPE RESTRICTION 
- NON-INDEPENDENCE 
- GOING CONCERN 
- MATERIAL UNCERTAINTY
ADVERSE - NON-GAAP
** SAS 79 ELIMINATES THE REQUIREMENT FOR INCLUDING AN EXPLANATORY PARAGRAPH IN THE AUDIT REPORT.
 



UNQUALIFIED REPORT MODIFICATIONS
SHARED RESPONSIBILITY
INTRODUCTORY PARAGRAPH
... WE DID NOT AUDIT THE FINANCIAL STATEMENTS OF DEF COMPANY A WHOLLY OWNED SUBSIDIARY, WHICH STATEMENTS REFLECT TOTAL ASSETS OF 2,500,000 AS OF DECEMBER 31, 19X4 AND TOTAL REVENUES OF 6,500,000 FOR THE YEAR THEN ENDED. THOSE STATEMENTS WERE AUDITED BY OTHER AUDITORS WHOSE REPORT HAS BEEN FURNISHED TO US, AND OUR OPINION, INSOFAR AS IT RELATES TO THE AMOUNTS INCLUDED FOR DEF COMPANY, IS BASED SOLELY ON THE REPORT OF THE OTHER AUDITORS.
ADD 2 SENTENCES AT END OF PARAGRAPH 
- DID NOT AUDIT ENTITY (NAME) 
- DOLLAR AMOUNTS (ABSOLUTE OR PERCENT) 
- AUDITED BY OTHER AUDITORS 
- OUR OPINION IS BASED ON REPORT OF OTHER AUDITOR
SCOPE PARAGRAPH
... WE BELIEVE THAT OUR AUDIT AND THE REPORT OF OTHER AUDITORS PROVIDE A REASONABLE BASIS FOR OUR OPINION.
MODIFY LAST SENTENCE OF PARAGRAPH 
- OUR AUDIT AND REPORT OF OTHER AUDITORS PROVIDE REASONABLE BASIS
OPINION PARAGRAPH
IN OUR OPINION, BASED ON OUR AUDIT AND THE REPORT OF OTHER AUDITORS, THE CONSOLIDATED FINANCIAL STATEMENTS REFERRED TO ABOVE ...
MODIFY FIRST SENTENCE OF PARAGRAPH 
- OUR OPINION IS BASED ON OUR AUDIT AND REPORT OF OTHER AUDITORS
NOTE: WHEN ANOTHER AUDITOR IS INVOLVED WITH AN AUDIT THE PRINCIPAL AUDITOR SHOULD ALWAYS:
- CHECK THE REPUTATION OF THE OTHER AUDITOR.
- OBTAIN REPRESENTATION LETTER OF OTHER AUDITOR'S INDEPENDENCE.
- ASCERTAIN THAT THE OTHER AUDITOR KNOWS U.S. ACCOUNTING AND AUDITING STANDARDS
- ASCERTAIN THAT THE OTHER AUDITOR KNOWS SUBSIDIARY WILL BE INCLUDED IN THE CONSOLIDATED FINANCIAL STATEMENTS.
 
 



UNQUALIFIED REPORT MODIFICATIONS
GOING CONCERN 
EXPLANATORY PARAGRAPH
THE ACCOMPANYING FINANCIAL STATEMENTS HAVE BEEN PREPARED ASSUMING THAT ABC COMPANY WILL CONTINUE AS A GOING CONCERN. AS DISCUSSED IN NOTE Y TO THE FINANCIAL STATEMENTS, ABC COMPANY HAS SUFFERED RECURRING LOSSES FROM OPERATIONS AND HAS NET CAPITAL DEFICIENCY THAT RAISES SUBSTANTIAL DOUBT ABOUT THE COMPANY'S ABILITY TO CONTINUE AS A GOING CONCERN. MANAGEMENT'S PLANS IN REGARD TO THESE MATTERS ARE ALSO DESCRIBE IN NOTE Y. THE FINANCIAL STATEMENTS DO NOT INCLUDE ANY ADJUSTMENTS THAT MIGHT RESULT FORM THE OUTCOME OF THIS UNCERTAINTY.
ADD AN EXPLANATORY PARAGRAPH AFTER OPINION 
- FINANCIAL STATEMENTS PREPARED ASSUMING GOING CONCERN 
- CIRCUMSTANCES HAVE RISEN THAT RAISE SUBSTANTIAL DOUBT ABOUT GOING CONCERN 
- REFER TO MANAGEMENT FOOTNOTE 
- FINANCIAL STATEMENTS DO NOT INCLUDE ADJUSTMENTS
NOTE: THIS EXPLANATORY PARAGRAPH IS USED IF THE AUDITOR BELIEVES THE AUDIT CLIENT WILL NOT CONTINUE FOR AT LEAST ONE MORE YEAR. THE AUDITOR CAN ALSO ISSUE A DISCLAIMER.
 
 



UNQUALIFIED REPORT MODIFICATIONS
NON-GAAP AUDITOR CONCURS 
EXPLANATORY PARAGRAPH
AS DESCRIBED IN NOTE Q, IN MAY 19XX, THE COMPANY EXCHANGED SHARES OF ITS COMMON STOCK FOR $5,060,000 OF ITS OUTSTANDING PUBLIC DEBT. THE FAIR VALUE OF THE COMMON STOCK ISSUED EXCEEDED THE CARRYING AMOUNT OF THE DEBT BY $466,000, WHICH HAS BEEN SHOWN AS AN EXTRAORDINARY LOSS IN THE 1987 STATEMENT OF OPERATIONS. BECAUSE A PORTION OF THE DEBT EXCHANGED WAS CONVERTIBLE DEBT, A LITERAL APPLICATION OF STATEMENT OF FINANCIAL ACCOUNTING STANDARDS NO. 84"INDUCED CONVERSIONS OF CONVERTIBLE DEBT," WOULD HAVE RESULTED IN A FURTHER REDUCTION IN NET INCOME OF $3,611,000, WHICH WOULD HAVE BEEN OFFSET BY A CORRESPONDING $3,611,000 CREDIT TO ADDITIONAL PAID IN CAPITAL; ACCORDINGLY, THERE WOULD HAVE BEEN NO NET EFFECT ON STOCKHOLDERS' INVESTMENT. IN THE OPINION OF COMPANY MANAGEMENT, WITH WHICH WE AGREE, A LITERAL APPLICATION OF ACCOUNTING LITERATURE WOULD HAVE RESULTED IN MISLEADING FINANCIAL STATEMENTS THAT DO NOT PROPERLY PORTRAY THE ECONOMIC CONSEQUENCES OF THE EXCHANGE.
ADD AN EXPLANATORY PARAGRAPH BEFORE OR AFTER OPINION 
- REFER TO MANAGEMENT FOOTNOTE 
- DISCUSS NON-GAAP ITEM 
- MANAGEMENT BELIEVES AND WE CONCUR THAT LITERAL APPLICATION WOULD RESULT IN MISLEADING FINANCIAL STATEMENTS 
** SAS 79 ELIMINATES THE REQUIREMENT FOR INCLUDING AN EXPLANATORY PARAGRAPH IN THE AUDIT REPORT.
 
 



UNQUALIFIED REPORT MODIFICATIONS
INCONSISTENCY IN GAAP** 
EXPLANATORY PARAGRAPH
AS DISCUSSED IN NOTE V TO THE FINANCIAL STATEMENTS, THE COMPANY CHANGED ITS METHOD OF COMPUTING DEPRECIATION IN 19X1.
ADD A ONE SENTENCE EXPLANATORY PARAGRAPH AFTER OPINION 
- REFER TO MANAGEMENT FOOTNOTE 
- NOTE ITEM 
EMPHASIS OF A MATTER 
EXPLANATORY PARAGRAPH
AS DISCUSSED IN NOTE X TO THE FINANCIAL STATEMENTS, THE COMPANY HAS HAD NUMEROUS DEALINGS WITH BUSINESSES CONTROLLED BY, AND PEOPLE WHO ARE RELATED TO, THE OFFICERS OF THE COMPANY.
ADD AN EXPLANATORY PARAGRAPH BEFORE OR AFTER OPINION 
- REFER TO MANAGEMENT FOOTNOTE 
- NOTE ITEM
CHANGE IN PREVIOUSLY ISSUED OPINION 
EXPLANATORY PARAGRAPH
IN OUR REPORT DATED MARCH 1, 19X4, WE EXPRESSED AN OPINION THAT THE 19X3 FINANCIAL STATEMENTS DID NOT FAIRLY PRESENT FINANCIAL POSITION, RESULTS OF OPERATIONS, AND CASH FLOWS IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES BECAUSE OF A DEPARTURE FROM SUCH PRINCIPLES. THE COMPANY CARRIED ITS PROPERTY, PLANT, AND EQUIPMENT AT APPRAISAL VALUES, AND PROVIDED FOR DEPRECIATION ON THE BASIS OF SUCH VALUES. AS DESCRIBED IN NOTE X, HAS CHANGED ITS METHOD OF ACCOUNTING FOR THESE ITEMS AND RESTATED ITS 19X3 FINANCIAL STATEMENTS TO CONFORM WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. ACCORDINGLY, OUR PRESENT OPINION ON THE 19X3 FINANCIAL STATEMENTS, AS PRESENTED HEREIN, IS DIFFERENT FORM THE EXPRESSED IN OUR PREVIOUS REPORT.
ADD AN EXPLANATORY PARAGRAPH BEFORE OPINION 
- DATE OF REPORT 
- OPINION EXPRESSED 
- CIRCUMSTANCES CAUSING CHANGE IN OPINION 
- UPDATED OPINION DIFFERENT
** A CHANGE IN ACCOUNTING PRINCIPLE THAT REQUIRES RETROACTIVE RESTATEMENT ONLY REQUIRES AN EXPLANATORY PARAGRAPH IN THE YEAR OF THE CHANGE. AN ACCOUNTING PRINCIPLE CHANGE THAT DOESN'T REQUIRE RETROACTIVE RESTATEMENT REQUIRES AN EXPLANATORY PARAGRAPH IN ALL AUDIT REPORTS THAT COVER THE CHANGE YEAR.
 
 



UNQUALIFIED REPORT MODIFICATIONS
PREDECESSOR AUDITOR'S REPORT NOT PRESENTED 
INTRODUCTORY PARAGRAPH
... THE FINANCIAL STATEMENTS OF ABC CORPORATION AS OF DECEMBER 31, 19X3, WERE AUDITED BY OTHER AUDITORS WHOSE REPORT DATED MARCH 31, 19X4, EXPRESSED AN UNQUALIFIED OPINION ON THOSE STATEMENTS.
ADD SENTENCE TO END OF FIRST PARAGRAPH 
- LAST YEARS STATEMENTS AUDITED BY OTHER AUDITORS 
- DATE OF REPORT 
- OPINION EXPRESSED
NOTE: WHEN A PREDECESSOR AUDITOR DECIDES TO RE-ISSUE THE PRIOR YEAR AUDIT REPORT. THE PREDECESSOR AUDITOR SHOULD READ THE CURRENT YEAR FINANCIAL STATEMENTS, COMPARE THE PRIOR YEAR FINANCIAL STATEMENTS WITH THE CURRENT YEAR, AND OBTAIN LETTER OF REPRESENTATION FROM THE CURRENT AUDITOR ABOUT WHETHER MATERIAL MATTERS HAVE ARISEN CONCERNING THE PRIOR YEAR FINANCIAL STATEMENTS.
 
 



QUALIFIED REPORTS
QUALIFIED -- SCOPE LIMITATION
SCOPE PARAGRAPH
EXCEPT AS DISCUSSED IN THE FOLLOWING PARAGRAPH, ...
MODIFY FIRST SENTENCE OF SCOPE PARAGRAPH 
- EXCEPT
EXPLANATORY PARAGRAPH
WE WERE UNABLE TO OBTAIN AUDITED FINANCIAL STATEMENTS SUPPORTING THE COMPANY'S INVESTMENT IN A FOREIGN AFFILIATE STATED AT $250,000 AT DECEMBER 31, 19X4 OR ITS EQUITY IN EARNINGS OF THAT AFFILIATE OF $650,000, WHICH IS INCLUDED IN NET INCOME FOR THE YEAR THEN ENDED AS DESCRIBED IN NOTE X TO THE FINANCIAL STATEMENTS; NOR WERE WE ABLE TO SATISFY OURSELVES AS THE CARRYING VALUE OF THE INVESTMENT IN THE FOREIGN AFFILIATE OR EQUITY IN ITS EARNINGS BY OTHER AUDITING PROCEDURES.
ADD EXPLANATORY PARAGRAPH BEFORE OPINION PARAGRAPH 
- WE WERE UNABLE TO AUDIT 
- NOTE SCOPE LIMITATION 
- NOR WERE WE ABLE TO SATISFY OURSELVES BY OTHER PROCEDURES
OPINION PARAGRAPH
IN OUR OPINION, EXCEPT FOR THE EFFECTS OF SUCH ADJUSTMENTS, IF ANY, AS MIGHT HAVE BEEN DETERMINED TO BE NECESSARY HAD WE BEEN ABLE TO EXAMINE EVIDENCE REGARDING THE FOREIGN AFFILIATE INVESTMENT AND EARNINGS, ...
MODIFY FIRST SECTION OF OPINION PARAGRAPH 
- EXCEPT FOR THE EFFECTS OF SUCH ADJUSTMENTS, IF ANY 
- HAD WE BEEN ABLE TO OBTAIN EVIDENCE 
- NOTE SCOPE LIMITATION
QUALIFIED -- NON-GAAP
EXPLANATORY PARAGRAPH
THE COMPANY HAS EXCLUDED FROM PROPERTY AND DEBT IN THE ACCOMPANYING BALANCE SHEET, CERTAIN LEASE OBLIGATIONS THAT, IN OUR OPINION, SHOULD BE CAPITALIZED IN ORDER TO CONFORM WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. IF THESE LEASE OBLIGATIONS WERE CAPITALIZED, PROPERTY WOULD BE INCREASED BY $300,000, LONG TERM DEBT BY $250,000, AND RETAINED EARNINGS BY $50,000 AS OF DECEMBER 31, 19X4. ADDITIONALLY, NET INCOME WOULD BE INCREASED BY $50,000 AND EARNINGS PER SHARE WOULD BE DECREASED BY $0.50 FOR THE YEAR THEN ENDED.
ADD EXPLANATORY PARAGRAPH BEFORE OPINION PARAGRAPH 
- NOTE NON-GAAP ITEM 
- PROVIDE AMOUNTS IF REASONABLE POSSIBLE
OPINION PARAGRAPH
IN OUR OPINION, EXCEPT FOR THE EFFECTS OF NOT CAPITALIZING CERTAIN LEASE OBLIGATIONS, AS DISCUSSED IN THE PRECEDING PARAGRAPH, ...
MODIFY FIRST SECTION OF OPINION PARAGRAPH 
- EXCEPT FOR THE EFFECTS OF NOT 
- NOTE NON-GAAP ITEM



DISCLAIMER REPORTS
DISCLAIMER -- SCOPE LIMITATION
INTRODUCTORY PARAGRAPH
WE WERE ENGAGED TO AUDIT ...
MODIFY FIRST SENTENCE OF INTRODUCTORY PARAGRAPH 
- WE WERE ENGAGED 
- DELETE LAST SENTENCE ON AUDITOR'S RESPONSIBILITY
SCOPE PARAGRAPH DELETE SCOPE PARAGRAPH
EXPLANATORY PARAGRAPH
WE DID NOT OBSERVE THE TAKING OF THE PHYSICAL INVENTORY AS OF DECEMBER 31, 19X4 OR 19X3, SINCE THOSE DATES WERE PRIOR TO OUR APPOINTMENT AS AUDITORS FOR THE COMPANY, AND WE WERE UNABLE TO SATISFY OURSELVES REGARDING INVENTORY QUANTITIES BY MEANS OF OTHER AUDITING PROCEDURES. THE DECEMBER 31, 19X4 AND 19X3 INVENTORY AMOUNTS ENTER INTO THE DETERMINATION OF NET INCOME AND CASH FLOWS FOR THE YEAR ENDED DECEMBER 31, 19X4.
ADD EXPLANATORY PARAGRAPH BEFORE THE OPINION PARAGRAPH 
- WE WERE UNABLE TO AUDIT 
- NOTE SCOPE LIMITATION 
- NOR WERE WE ABLE TO SATISFY OURSELVES BY OTHER PROCEDURES
OPINION PARAGRAPH
SINCE THE COMPANY DID NOT TAKE PHYSICAL INVENTORIES AND WE WERE UNABLE TO APPLY OTHER AUDITING PROCEDURES TO SATISFY OURSELVES AS TO INVENTORY QUANTITIES, THE SCOPE OF OUR WORK WAS NOT SUFFICIENT TO ENABLE US TO EXPRESS, AND WE DO NOT EXPRESS, AN OPINION ON THESE FINANCIAL STATEMENTS.
MODIFY THE OPINION PARAGRAPH 
- SINCE WE WERE UNABLE TO SATISFY OURSELVES REGARDING 
- THE SCOPE WAS NOT SUFFICIENT 
- WE DO NOT EXPRESS AN OPINION
DISCLAIMER -- LACK OF INDEPENDENCE
WE ARE NOT INDEPENDENT WITH RESPECT TO ABC CORPORATION, AND THE ACCOMPANYING BALANCE SHEET AS OF DECEMBER 31, 19X4, AND THE RELATED STATEMENTS OF INCOME, RETAINED EARNINGS AND CASH FLOWS FOR THE YEAR THEN ENDED WERE NOT AUDITED BY US. ACCORDINGLY, WE DO NOT EXPRESS AN OPINION ON THEM. ONE PARAGRAPH REPORT 
- WE ARE NOT INDEPENDENT 
- LIST STATEMENTS 
- ACCORDINGLY, WE DO NOT EXPRESS AN OPINION
NOTE: GENERALLY SHOULD NOT PROVIDE ASSURANCES FOR SEGMENTS OF THE FINANCIAL STATEMENTS (PIECEMEAL OPINIONS).
 
 



ADVERSE REPORT
ADVERSE -- NON-GAAP
EXPLANATORY PARAGRAPH
AS DISCUSSED IN NOTE X TO THE FINANCIAL STATEMENTS, THE COMPANY CARRIES ITS PROPERTY, PLANT, AND EQUIPMENT ACCOUNTS AT APPRAISAL VALUES, AND PROVIDES DEPRECIATION ON THE BASIS OF SUCH VALUES. GENERALLY ACCEPTED ACCOUNTING PRINCIPLES REQUIRE THAT PROPERTY, PLANT, AND EQUIPMENT BE STATED AT AN AMOUNT NOT IN EXCESS OF COST, REDUCED BY DEPRECIATION BASED ON SUCH AMOUNT. BECAUSE OF THIS DEPARTURE, AS OF DECEMBER 31, 19X4 INVENTORIES HAVE BEEN INCREASED BY $450,000 BY INCLUSION IN MANUFACTURING OVERHEAD OF DEPRECIATION IN EXCESS OF THAT BASED ON COST; PROPERTY, PLANT, AND EQUIPMENT, LESS ACCUMULATED DEPRECIATION IS CARRIED AT $12,500,000 IN EXCESS OF AN AMOUNT BASED ON COST; RESULTING ON AN INCREASE IN RETAINED EARNINGS OF $450,000 AND APPRAISAL SURPLUS OF $12,500,000. FOR THE YEAR ENDED DECEMBER 31, 19X4 COST OF GOODS SOLD HAS BEEN INCREASED BY $350,000 BECAUSE OF THE EFFECTS OF THE DEPRECIATION ACCOUNTING REFERRED TO ABOVE, RESULTING IN AN DECREASE IN NET INCOME OF $117,000.
ADD EXPLANATORY PARAGRAPH BEFORE OPINION PARAGRAPH 
- NOTE NON-GAAP ITEM 
- PROVIDE AMOUNTS IF REASONABLY POSSIBLE
OPINION PARAGRAPH
IN OUR OPINION, BECAUSE OF THE EFFECTS OF THE MATTER DISCUSSED IN THE PRECEDING PARAGRAPH, THE FINANCIAL STATEMENTS REFERRED TO ABOVE DO NOT PRESENT FAIRLY, IN ALL MATERIAL RESPECTS, THE FINANCIAL POSITION OF ABC CORPORATION AS OF DECEMBER 31, 19X4, AND THE RESULTS OF ITS OPERATIONS AND ITS CASH FLOWS FOR THE YEAR THEN ENDED IN CONFORMITY WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES.
MODIFY FRONT END OF OPINION PARAGRAPH 
- BECAUSE OF THE EFFECTS OF THE NON-GAAP ITEM 
- THE FINANCIAL STATEMENTS DO NOT PRESENT FAIRLY
NOTE: GENERALLY SHOULD NOT PROVIDE ASSURANCES FOR SEGMENTS OF THE FINANCIAL STATEMENTS (PIECEMEAL OPINIONS).