B2B, how did A & B combine? In order for B to combine with A (through merger or consolidation) the accounting data for both entity has to be known and the two data are consolidated into one financial statement. Assets/liabilities on the books of both companies are remeasured to fair market value and combined. This process would take place prior to any audit. Therefore, to say A is not providing the information doesn't make sense post consolidation.
How significant is A's asset/liabilities in comparison to B? It sounds like B has greater share of asset/liability than A. Knowing accounting data for A is not very critical in this situation. Accounting data can traced back to its source. If A is showing $100,000 in cash on their financial statement, they should be able to corroborate that amount by tracing it to the bank statements, which would total that amount. If they show $2,000,000 in property, plant, and equipment you should be able to trace that amount to various documents that make up the PP & E that would add up to that amount. If there is a discrepancy, then the record should be adjusted to reflect the correct amount. Again, this should have been done during the acquisition phase.
If B is not coming forward with requested documents during Audit, and the information has a material effect on the financial statement, the auditor will first recommend to B the adjustment required to fix this problem. If management refuse to make changes the Auditor will probably issue an Auditor's Report with a "Disclaimer" opinion. Basically, it means the auditor can not comment on the fairness of the company's financial statement because they couldn't get sufficient evidence to render an opinion. Although this is a negative, the financial statement is still Audited at this point.
"in a situation like this a period of time must pass before B can do an audit that does not include A's data."
Again, it depends on how they were combined. I presume A & B becme 1 entity through a merger or consolidation. In which case, both data are combined to become one entity. Technically A's data will always be part of B since they are one and the same. However, once As accounting information is corrected during the combination, it shouldn't be an ongoing issue as long as B is adequately recording the new information.
IMO B isn't being straight forward with the shareholders.
