You have been asked by the audit partner to draft a letter to the client on internal control related matters. You were informed that the written communication regarding significant deficiencies and material weaknesses indentified during an audit of financial statements should include certain statements. For each of the significant deficiencies and material weaknesses reflected in the table below, double-click on each of the associated shaded cells and select from the list provided the appropriate disposition of each statement in regard to the letter to the client on internal control related matters. Each selection may be used once, more than once, or not at all.
Included, Excluded, Included but only with client management's approval
Communicated orally with no need to document the communication
Internal controls
Related matters
1. State that the purpose of the audit was to express an opinion on the financial statements, and to express an opinion on the effectiveness of the entity's internal control over financial reporting.
2. Identify, if applicable, items that are considered to be material weaknesses.
3. State that the author is not expressing an opinion on the effectiveness of internal control.
4. Include the definition of the term significant deficiency.
5. Include the definition of the term material weakness, where relevant.
6. State that the author is expressing an unqualified opinion on the effectiveness of internal control.
7. State that the communication is intended solely for management and external parties.
8. Identify the matters that are considered to be significant deficiencies.
select an option at related matters:1 included 2. excluded 3. included, but only with client management's approval 4. communicated orally with no need to document the communication