Modified Opinions due to audit issues

Question 1

An auditor may issue a qualified opinion for auditing issues when

Answer 1

Lack of sufficient appropriate audit evidence or when there are restrictions on the scope of the audit.
Auditor is not independent with respect to the unadited entity

Question 2

A disclaimer results from

Answer 2

Scope limitations, such as:
- management’s refusal to furnish a client’s representation letter
-Management refusal to accept responsibility for
- Unable to obtain sufficient appropriate audit evidence
- Inadequacy in the accounting records.
-Lack of sufficient evidence in a litigation
- An independent CPA is associated but has not audited or reviewed such statements of a publicly held company

Question 3

When an auditor qualifies his opinion because of a scope limitation, the wording in the opinion paragraph should indicate that?

Disclosed in the basis for Disclaimer of Opinion Section rather than Resp

Answer 3

The qualification pertains to the possible effects on the financial statements and not to the scope limitation itself.