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when da auditor finds material misstatements..he MODIFIES da opinion by giving QUALIFIED,ADVERSE OPINION etc according to da situation..ND includes a separate paragraph in the audit report..get da point???
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According to previous terminology, qualified word used if auditor disagree with the client and found material misstatement. but now modified word using which clarifies the situation more specefic. @antido
there is no such terminology like qualified, new clarified isa discourage u to use the word. Modified opinion can be three types, Emphasis on matter paragraph/ Disagreement/Limitation of scope @reshi
Hi According to BPP tutor,
Audit report can be either unmodified unqualified or modified report.
– Unmodified and Unqualified (Clean audit report)- true ad fair
-Modified- this can then be broken down to -Unqualified and qualified.
Modified unqualified (MU)- still saying true and fair but there is emphasis of matter(if any material uncertainty exist though accounted for and disclosed appropriately) or Other matter paragraph(if inconsistencies in other information outside audit scope) after the Opinion. What MU is basically saying is, the statement is true and fair but pls look critically into the paragraph below before taking a decision.
Modified and qualified opinion(“except for”) is when there is a material mistatement or there is insufficient or inappropriate evidence and the effect is only material but not pervasive(that is it only relate to one disclosure/acct policy/double entry) . Where its material and pervasive, then its either a modified adverse report (for material misstatement) or ” disclaimer of opinion” i.e can not say if true and fair(for insufficient /inappropriate evidence).I hope this helps
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Yes if the opinion is unqualifed it means its true and fair, if its qualified then they dont use the true and fair opinion am i right?
And if its modified it means they have either added an emphasis of matter paragraph or disagreements or limitation of scope. All modified reports dont have to be qualified. am i right?
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