Page 624 - Auditing Standards

As of December 15, 2017
(incorporated by reference) in the registration statement includes one or more explanatory paragraphs or a

paragraph to emphasize a matter regarding the financial statements, the accountants should refer 18 to that
fact in the comfort letter and discuss the subject matter of the paragraph. 19 In those rare instances in which
the SEC accepts a qualified opinion on historical financial statements, the accountants should refer to the
qualification in the opening paragraph of the comfort letter and discuss the subject matter of the qualification.

(See also paragraph .35f.)

.28 The underwriter occasionally requests the accountants to repeat in the comfort letter their report on

the audited financial statements included (incorporated by reference) in the registration statement. Because of
the special significance of the date of the accountants' report, the accountants should not repeat their
opinion. 20 The underwriter sometimes requests negative assurance regarding the accountants' report.
Because accountants have a statutory responsibility with respect to their opinion as of the effective date of a

registration statement, and because the additional significance, if any, of negative assurance is unclear and
such assurance may therefore give rise to misunderstanding, accountants should not give such negative
assurance. Furthermore, the accountants should not give negative assurance with respect to financial

statements and financial statement schedules that have been audited and are reported on in the registration
statement by other accountants.

.29 The accountants may refer in the introductory paragraphs of the comfort letter to the fact that they
have issued reports on— 21

a. Condensed financial statements that are derived from audited financial statements (see AS 3315,
Reporting on Condensed Financial Statements and Selected Financial Data).

b. Selected financial data (see AS 3315).

c. Interim financial information (see AS 4105).

d. Pro forma financial information (see AT section 401, Reporting on Pro Forma Financial Information).

e. A financial forecast (see AT section 301, Financial Forecasts and Projections).

f. Management's discussion and analysis (see AT section 701, Management's Discussion and
Analysis).

Such a reference should be to the accountants' reports that were previously issued, and if the reports are not
included (incorporated by reference) in the registration statement, they may be attached to the comfort

letter. 22 In referring to previously issued reports, the accountants should not repeat their reports in the
comfort letter or otherwise imply that they are reporting as of the date of the comfort letter or that they
assume responsibility for the sufficiency of the procedures for the underwriter's purposes. However, for

certain information on which they have reported, the accountants may agree to comment regarding
compliance with rules and regulations adopted by the SEC (see paragraphs .33 and .34). Accountants should

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