When auditing a public company, the auditor must form an opinion on the effectiveness of internal control over financial reporting, or issue a disclaimer in the event of a scope limitation.

Question

Quizplus · Accepted Answer

This is true. As per the requirements of the Sarbanes-Oxley Act (SOX), auditors of public companies are required to form an opinion on the effectiveness of internal control over financial reporting. In case of a scope limitation, the auditor may issue a disclaimer stating that they were unable to obtain sufficient evidence to form an opinion on the effectiveness of internal control.

When Auditing a Public Company, the Auditor Must Form an Opinion