In short
A scope limitation is the auditor's inability to obtain sufficient appropriate audit evidence, because of circumstances such as destroyed records or because management restricts the work.
Key takeaways
- The opinion is qualified if the possible effects are material but not pervasive, and disclaimed if pervasive.
- If management imposes a limitation before the engagement is accepted that would lead to a disclaimer, the auditor generally declines the engagement.
- The auditor first tries alternative procedures.
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?