In short
A qualified ('except for') opinion is expressed when misstatements, or a lack of sufficient appropriate evidence, are material but not pervasive to the financial statements.
Key takeaways
- Material and pervasive misstatement leads to an adverse opinion instead.
- A material and pervasive inability to obtain evidence leads to a disclaimer of opinion.
- The report includes a basis for the qualified opinion explaining the matter.
Where it's tested
AUD: Audit Reports — study notes, a five-minute revision sheet and practice questions.
Practise: 3 questions
Question 1 of 3 · 0 answered
An auditor is unable to observe the physical inventory count or satisfy themselves through alternative procedures, and inventory represents 60% of total assets. What opinion is appropriate?