The auditor in the auditor's opinion can express both the modified and modified opinion on the reliability of the financial statements.
Unmodified opinion is expressed in the event that I am confident in the reliability of the financial statements of the financial position of all significant activities of the organization and their financial results submitted in accordance with the reporting rules.
Unmodified opinion is formulated in the auditor's opinion as follows: "The accounting statements reflect reliably in all material respects the financial position of the [audited entity] as of [the reporting date], the results of [its] financial and economic activities and the cash flow for [ fiscal year] year in accordance with the established rules for the preparation of financial statements. "
The auditor should express the modified opinion in the audit report, if:
a) Based on the audit evidence obtained, it is established that the accounting statements considered in general contain significant distortions;
b) he can not obtain sufficient appropriate audit evidence to establish that the accounting statements considered in general do not contain significant distortions (Table 8.1).
Dependence of the modified opinion form on the auditor's judgment on the nature of the circumstances that led to the expression of the modified opinion, and the degree of distribution of their influence on the financial statements
The nature of the circumstances that led to the expression of a modified opinion
Auditor's judgment on the extent to which influence is spread on the financial statements
Significant impact, but not comprehensive
Significant and all-encompassing impact
Financial statements are significantly distorted
Opinion with reservation
Absence of the possibility of obtaining sufficient appropriate audit evidence
Opinion with reservation
Refusal to express an opinion
If the auditor determines that the accounting statements are not reliable, then he should discuss this with the management of the audited entity and, depending on the requirements of the reporting rules, and on the decisions made by the management of the auditee, he must determine whether there is a need to modify the opinion in the audit report.
The customer can not always satisfy the auditor's opinion. As a result, he can apply to another auditor on this issue.
The situation when a publicly speaking professional accountant is asked to give a second opinion on the application of accounting standards, auditing, financial reporting, principles in specific circumstances or in respect of specific operations of a company that is not an auditor client may lead to threats violation of the basic principles.
The second opinion is not based on the same facts that are known to the current accountant, or it is based on inadequate evidence.
There is a threat of violation of the principle of professional competence and due diligence.
The existence and significance of such a threat depends on the circumstances and all other available facts and assumptions that are relevant when making a professional judgment.
In these appeals, a publicly practicing professional accountant should evaluate the significance of any threats to the violation of the basic principles of ethics and, as necessary, take precautions to eliminate them or reduce them to an acceptable level.
- contacting the customer for permission to communicate with the current accountant;
- notification of the service's customer about all restrictions related to expressing an opinion;
- providing the current accountant with a copy of the document containing the expression of the opinion.
If the company requesting this opinion does not give permission to communicate with the current accountant, the publicly practicing professional accountant must, having weighed all the circumstances, decide whether it is appropriate for him to provide the desired opinion.
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