CAF-8 · Chapter 14 · Question 1 of 10
An auditor identifies that the client has failed to provide a depreciation expense for a specific building, leading to a material misstatement. The rest of the financial statements are completely accurate. What type of audit opinion should be expressed?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Qualified opinion ('except for')
Explanation
When a misstatement is material but its effects are confined to a specific element (not pervasive to the entire set of financial statements), the auditor expresses a qualified opinion, stating that 'except for' this specific matter, the financial statements present fairly.
More Audit Finalisation - Reporting MCQs
- Q3A massive fire destroys the client's accounting servers, and no backups exist. The auditor cannot verify revenue, receivables, or…
- Q4According to ISA 701, 'Key Audit Matters' (KAM) are selected from which specific pool of information?
- Q5If an auditor is forced to issue a 'Disclaimer of Opinion' on a listed entity due to a pervasive lack of evidence, how does this impact…
- Q6A client faces a massive, highly publicized lawsuit that threatens its survival. Management has perfectly disclosed this contingent…
- Q7The financial statements of the prior year were audited by a different firm of Chartered Accountants. The incoming auditor wants to…