Auditing and Attestation- Certified Public Accountant (CPA) Practice Exam -

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When an auditor disclaims an opinion due to insufficient audit evidence, where should this situation be referred to in the report?

Auditor's Responsibility Paragraph
Notes to the financial statements
Both Auditor's Responsibility Paragraph and Notes
None of the above

The correct answer is: None of the above

When an auditor disclaims an opinion due to insufficient audit evidence, this situation is typically addressed within the report itself but not specifically categorized under the Auditor's Responsibility Paragraph or the Notes to the financial statements. Instead, the auditor's report will usually contain a specific section that explicitly states the disclaimer of opinion, outlining the reasons for the inability to obtain sufficient appropriate audit evidence. This section emphasizes the lack of evidence and its impact on the auditor's ability to express an opinion, making it clear to users of the financial statements that the auditor could not form a basis for an opinion on the financial statements due to these limitations. Thus, the disclaimer addresses the auditor's overall conclusion without assigning it to standard arms of the report like the Auditor's Responsibility Paragraph or the Notes.