When an entity changes its method of accounting for income
taxes, which has a material effect on comparability, the
auditor should refer to the change in an emphasis-of-matter paragraph
added to the auditor’s report. This paragraph should identify
the nature of the change and

(d) The requirement is to determine the information
that must be presented when a client has changed accounting
principles. Answer (d) is correct because in addition to identifying
the nature of the change, the auditor must refer to the financial
statement note that discusses the change in detail. Answer
(a) is incorrect because while the auditor must believe that
the change is justified, it is not necessary to explain it in the report.
Answer (b) is incorrect because the cumulative effect of the
change need not be described in the audit report. Answer (c) is
incorrect because the auditor need not make explicit concurrence
with the change.