A justified departure from GAAP may result in which of the following?
A)A disclaimer of an audit opinion.
B)An unqualified audit opinion with an explanatory paragraph.
C)An adverse opinion.
D)A qualified opinion.

Question

Quizplus · Accepted Answer

A justified departure from GAAP would result in an unqualified audit opinion with an explanatory paragraph, which explains the nature of the departure and its impact on the financial statements. This is because the departure is deemed to be justified, meaning that it does not materially affect the financial statements overall, and therefore the auditor can still issue an unqualified opinion. A disclaimer of an audit opinion, adverse opinion, and qualified opinion would only be issued if the departure was deemed to be unjustified and the financial statements were materially misstated.

A Justified Departure from GAAP May Result in Which of the Following