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Hello Miss, Why the Listed auditor has difficulty confirming opening balances will be disclose as Key Audit Matters rather than result in qualified or disclaimer of opinion?
See description of KAMs on page 111 – whatever these matters are – if they were to give rise to a modified opinion they would not be included as a KAM (any matter is reported in one place only in the auditor’s report),
Nothing “automatically” gives rise to a modified opinion – it’s quite possible that opening balances would be a KAM if a new auditor was appointed during the year, but it could only give rise to a modified opinion to the extent that it effects the fair presentation of the financial statements that are being reported on. In my opinion it seems highly improbable that a disclaimer of opinion could arise from lack of evidence about opening balances alone. Though a qualified opinion might be appropriate if possible misstatement in an opening balances results in limitation on scope regarding profit or loss (e.g. opening inventory effect on cost of sales).
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