Disclaimer of opinion

A disclaimer of opinion is expressed when the auditor cannot obtain sufficient appropriate audit evidence and concludes that possible effects of undetected misstatements could be both material and pervasive. The report explains the basis and does not express an opinion. The distinction from an adverse opinion is that the auditor lacks sufficient appropriate evidence rather than having established a pervasive material misstatement. The auditor assesses whether alternative procedures can resolve the limitation and considers the implications for the report and other required communications.