SAS No. 33 The Auditor's Report on Financial Statements Show
StatusRevised by Auditing Standards Committee in Taiwan on 21 December, 1999. SummaryThe auditor should review and assess the conclusions drawn from the audit evidence obtained as the basis for the expression of an opinion on the financial statements. The auditor’s report should contain a clear written expression of opinion on the financial statements taken as a whole. The auditor’s report includes the following basic elements, ordinarily in the following layout:
The auditor’s report should have an appropriate title to distinguish the auditor’s report from reports that might be issued by others. Introductory Paragraph The auditor’s report should identify the financial statements of the entity that have been audited, including the date of and period covered by the financial statements. The report should include a statement that the financial statements are the responsibility of the entity’s management and a statement that the responsibility of the auditor is to express an opinion on the financial statements based on the audit. Scope Paragraph The auditor’s report should describe the scope of the audit by stating that the audit was conducted in accordance with generally accepted auditing standards or in accordance with relevant national standards or practices as appropriate. The report should include a statement that the audit was planned and performed to obtain reasonable assurance about whether the financial statements are free of material misstatement.The auditor’s report should describe the audit as including:
The report should include a statement by the auditor that the audit provides a reasonable basis for the opinion. Opinion Paragraph The opinion paragraph of the auditor’s report should clearly state the auditor’s opinion as to whether the financial statements are presented fairly, in all material respects, in accordance with generally accepted accounting principles and, where appropriate, whether the financial statements comply with statutory requirements. Date of Report The auditor should date the report as of the completion date of the audit. The Auditor’s Reports Unqualified Report Modified Reports Matters that Do Not Affect the Auditor’s Opinion Certain circumstances, while not affecting the auditor’s unqualified opinion, may require that the auditor add an explanatory paragraph (or other explanatory language) to the standard report. These circumstances include:The auditor’s opinion is based in part on the report of another auditor.
Matters that Do Affect the Auditor’s Opinion
The circumstances described in (a) could lead to a qualified opinion or a disclaimer of opinion. The circumstances described in (b) could lead to a qualified opinion or an adverse opinion. Qualified Opinion Disclaimer of Opinion Adverse Opinion Whenever the auditor expresses an opinion that is other than unqualified, a clear description of all the substantive reasons should be included in the report and, unless impracticable, a quantification of the possible effect(s) on the financial statements. This information would be set out in a separate paragraph preceding the opinion or disclaimer of opinion on the financial statements and may include a reference to a more extensive discussion, if any, in a note to the financial statements. Effective dateThis Statement is effective from 31 December, 1999. When an auditor expresses an adverse opinion the opinion paragraph should?b. Describe in the "Basis for Opinion" section the nature of the omit- ted information. . 26 When the auditor expresses a qualified or an adverse opinion, the au- ditor should amend the statement required by paragraph .
Which of the following should be included in the opinion paragraph when an auditor expresses a qualified opinion?The opinion paragraph of the auditor's report should clearly state the auditor's opinion as to whether the financial statements are presented fairly, in all material respects, in accordance with generally accepted accounting principles and, where appropriate, whether the financial statements comply with statutory ...
When an auditor expresses an adverse opinion he she should disclose the substantive reasons?. 20 When the auditor expresses a qualified opinion, he or she should disclose, in a separate paragraph(s) immediately following the opinion paragraph, all of the substantive reasons that have led him or her to conclude that there has been a departure from generally accepted accounting principles.
What is an adverse opinion in audit?An auditor's adverse opinion is a big red flag. An adverse audit report usually indicates that financial reports contain gross misstatements and have the potential for fraud. Adverse opinions send out a high alert that the company's records haven't been prepared according to GAAP.
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