AICPA Exam CPA-Auditing Topic 1 Question 20 Discussion

Choice 'b' is correct. In a management (client) representation letter, the client will generally confirm that there have been no communications from regulatory agencies concerning matters that could have a material effect on the financial statements.

Choice 'a' is incorrect. A passage regarding communications from regulatory agencies generally will not be found in a special report.

Choice 'c' is incorrect. A passage regarding communications from regulatory agencies generally will not be found in a letter for an underwriter (i.e., a comfort letter).

Choice 'd' is incorrect. A passage regarding communications from regulatory agencies generally will not be found in a report on internal controls.