When unaudited financial statements of a nonissuer are presented in comparative form with audited financial statements in the subsequent year, the unaudited financial statements should be clearly marked to indicate their status and:
I.
The report on the unaudited financial statements should be reissued.
II.
The report on the audited financial statements should include a separate paragraph describing the responsibility assumed for the unaudited financial statements.
Choice "C" is correct. When audited financial statements are presented in comparative form with unaudited financial statements from a prior year, the auditor should either reissue his or her report on the unaudited statements or include a separate paragraph in the current year report describing the responsibility assumed for the unaudited statements.
Choices "b", "d", and "a" are incorrect, per above explanation.
