Mead, CPA, had substantial doubt about Tech Co.'s ability to continue as a going concern when reporting on Tech's audited financial statements for…

Choice "a" is correct. If substantial doubt about the entity's ability to continue as a going concern has

been removed in the current period, the explanatory paragraph included in the prior period auditor's

report should not be repeated, and no description of the reasons or plans for recovery need be

included.

Choice "b" is incorrect. If doubt about the going concern assumption has been removed in the

current period, it is not appropriate to include the explanatory paragraph from the prior year in the

auditor's report for the current year.

Choice "c" is incorrect. If doubt about the going concern assumption has been removed in the

current period, no explanatory paragraph is required since the situation no longer exists. The auditor

does not have to explain the reason for the change.

Choice "d" is incorrect. If doubt about the going concern assumption has been removed in the

current period, no explanatory paragraph is required since the situation no longer exists. The entity

does not have to describe its plans for the future.