If the financial statements contain a departure from GAAP, the auditor should express:
A) an adverse opinion.
B) a qualified opinion.
C) a disclaimer of opinion.
D) either a disclaimer of opinion or a qualified opinion.
E) either a qualified opinion or an adverse opinion.

Question

Quizplus · Accepted Answer

A departure from GAAP can lead to either a qualified opinion or an adverse opinion depending on the materiality and pervasiveness of the departure. A qualified opinion is expressed when the departure is material but not pervasive, while an adverse opinion is given when the departure is both material and pervasive.

If the Financial Statements Contain a Departure from GAAP, the Auditor