An auditor was unable to obtain audited financial statements or other evidence supporting an entity's investment in a large foreign subsidiary.Between which of the following reports should the auditor choose?
A) Adverse and unqualified with an explanatory/emphasis-of-matter paragraph added.
B) Disclaimer and unqualified with an explanatory/emphasis-of-matter paragraph added.
C) Qualified and adverse.
D) Qualified and disclaimer.

Question

Quizplus · Accepted Answer

The auditor should choose between a qualified opinion and a disclaimer of opinion. A qualified opinion is appropriate when the auditor concludes that misstatements, individually or in the aggregate, are material but not pervasive. A disclaimer of opinion is appropriate when the auditor is unable to obtain sufficient appropriate audit evidence on which to base an opinion, and the possible effects on the financial statements could be both material and pervasive.

An Auditor Was Unable to Obtain Audited Financial Statements or Other