Auditors would not normally issue a qualified opinion on the entity's financial statements when
A)An accounting principle at variance with generally accepted accounting principles is used.
B)The auditors lack independence with respect to the audited entity.
C)A scope limitation prevents the auditors from completing an important auditing procedure.
D)The entity has undertaken a change in accounting principle with which the auditor does not agree.

Question

Quizplus · Accepted Answer

The lack of independence of the auditors with respect to the audited entity is a fundamental issue that would result in a disclaimer of opinion rather than a qualified opinion. Qualified opinions are issued when the auditors have concerns about specific items in the financial statements or when a scope limitation prevents them from obtaining sufficient evidence. The use of an accounting principle at variance with generally accepted accounting principles, or a change in accounting principle with which the auditor disagrees, may result in a qualified opinion if the impact on the financial statements is material and pervasive. However, the specific circumstances would need to be evaluated in each case.

Auditors Would Not Normally Issue a Qualified Opinion on the Entity's