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Minehead Co has commissioned a report from an independent specialist which had indicated that mineral reserves at a quarry are 50% higher than was previously thought. The company proposes to adjust the amortisation rate to reflect the new estimate in its accounts and the effect will be material. What action should the auditor normally take? A. Confirm that it is reasonable to accept the estimate and ensure that it is appropriately disclosed in the accounts. B. Confirm that it is reasonable to accept the estimate, ensure it is appropriately disclosed in the accounts AND indicate in the audit report that his opinion is subject to his reliance upon a management expert. C. Commission an auditor expert report to confirm the general findings before considering the matter further. D. Advise that, because of the subjective nature of any estimate of this kind, the revised value can be disclosed in the notes but should not be incorporated in the accounts. |