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Hello Sir Mike,
It feels really great to read your answers on the “Ask the Tutor ACCA P7 Exams” section on the opentuition.com.
I really appreciate you sir for providing all the answers.
Today Here’s my question-
Is ‘Material Uncertainty Related to Going Concern’ not the same as saying that the entity is having a Going Concern problem? If it is so, why the ‘Material Uncertainty Related to Going Concern’ section in the new audit report is only a modified report but not an unmodified opinion?
I believe the IAASB has not completely resolved the ambiguities involved in the new audit report. I toiling hard to understand everything that go with the new audit report format sir.
Thank you in advance for the answer.
It’s a material uncertainty … but it’s not material enough to modify the opinion
It comes down to a matter of skill and judgement in the mind of the experienced auditor … is the matter SO material and SO uncertain as to render the financial statements meaningless?
If the auditor is really convinced of the magnitude of the uncertainties that affect the future of the client, then a disclaimer could be appropriate
“I believe the IAASB has not completely resolved the ambiguities involved in the new audit report”
They can’t do and never will be able to! The audit report main purpose is to express an opinion on something as nebulous as the truth and fairness (nowhere is t & f defined) and that opinion is merely the opinion of the individual partner that is signing the audit report
It could so easily be a different opinion were the file to be reviewed by a different person
(Thankfully) we are all individuals, not clones, and opinions differ from one person to another
OK?
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