ACCA AA · Chapter 13 · Question 4 of 12
Under ISA 705, what type of opinion is required when the auditor concludes that misstatements are both material and pervasive?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) Adverse opinion
Explanation
An adverse opinion states that the financial statements do not give a true and fair view, and is required when misstatements are material and pervasive. A qualified opinion is for material but not pervasive matters, and a disclaimer relates to an inability to obtain sufficient appropriate evidence.
More Misstatements and the auditor's report MCQs
- Q6Under ISA 705, which of the following would NOT make the effects of a misstatement pervasive?
- Q7Which situation would lead the auditor to disclaim an opinion under ISA 705?
- Q8Which of the following best describes when an Emphasis of Matter paragraph is used under ISA 706?
- Q9Under ISA 701, from which matters does the auditor select key audit matters?
- Q10The auditor of Hasp Co concludes that the going concern basis is appropriate, but that a material uncertainty exists which is adequately…