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When the auditors find a material misstatement (whether pervasive or not) or maybe a non-disclosed going concern issue, do they issue a modified opinion as it is, or do they first ask the management to correct it and only issue a modified opinion if the management doesn’t correct the issue?
See the last two paras of s.7. on page 35 of the notes:
All misstatements identified should be communicated to management who should be asked to
correct them or to explain why not. The auditors must assess the materiality of uncorrected
statements and obtain written representations from management that they believe uncorrected
misstatements to be not material. (see Chapter 28)If management refuses to correct an error that the auditor thinks is material then the auditor will issue a modified (qualified “except for”) audit opinion.
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