Choice "B" is correct. The auditor would explain to the client that in order for the entity's financial statements to be in conformity with GAAP, there must be adequate disclosures of all material matters including all financial statements and the supporting footnotes. As a result, the auditor would tell Zag that without adequate disclosure of the entity's cash flows, the audit report would have to be issued with a qualified or adverse audit opinion.Choice "a" is incorrect. Missing the statements of cash flows would not result in an unmodified opinion with an additional emphasis-of-matter paragraph because no statement of cash flows is a material departure from GAAP.Choice "c" is incorrect. The auditor is not required to refuse to accept the engagement, but the client should be made aware that the missing statement of cash flows will result in a qualified or adverse opinion. Choice "d" is incorrect. The responsibility to prepare the statement of cash flows is solely the client's.