When an entity will not permit inquiry of outside legal counsel,the auditors' report on the entity's financial statements will ordinarily contain a(n)
A) Disclaimer of opinion.
B) Qualified opinion referencing a departure from generally accepted accounting principles.
C) Unqualified opinion with a separate explanatory paragraph.
D) Adverse opinion.

Question

Quizplus · Accepted Answer

When auditors are not allowed to inquire of outside legal counsel, they are unable to obtain sufficient evidence to assess the potential outcomes of any material litigation or claims. As a result, auditors cannot provide reasonable assurance about the financial statements, which leads to a disclaimer of opinion.

When an Entity Will Not Permit Inquiry of Outside Legal