A client company has a history of negative cash flow trends and continuing losses.Which type of opinion will the auditor most likely issue?
A)Adverse.
B)Unqualified with explanatory language.
C)Qualified.
D)Disclaimer of opinion.

Question

Quizplus · Accepted Answer

Negative cash flow trends and continuing losses do not necessarily affect the auditor's ability to obtain sufficient appropriate audit evidence regarding the financial statements as a whole. Therefore, the auditor may issue an unqualified opinion but might add explanatory language to highlight the entity's ability to continue as a going concern if there are substantial doubts.

A Client Company Has a History of Negative Cash Flow