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

Disable ads (and more) with a membership for a one time $2.99 payment

Prepare for the CPA Auditing and Attestation Exam. Leverage comprehensive materials, flashcards, and detailed explanations for each question. Master essential auditing concepts and techniques with confidence!

Each practice test/flash card set has 50 randomly selected questions from a bank of over 500. You'll get a new set of questions each time!

Practice this question and more.

Which opinion would an auditor most likely issue if they obtained insufficient evidence to support assertions?

Unmodified opinion.
Qualified opinion.
Adverse opinion.
Disclaimer of opinion.

The correct answer is: Disclaimer of opinion.

When an auditor is unable to obtain sufficient appropriate evidence to support the financial statements' assertions, they are faced with a significant limitation in their ability to perform an adequate audit. In such scenarios, the auditor may issue a disclaimer of opinion. This indicates that the auditor does not express an opinion on the financial statements due to the lack of evidence necessary to form a basis for an audit opinion. A disclaimer of opinion communicates to users of the financial statements that the auditor has not been able to gather sufficient information and, as a result, cannot provide any assurance regarding the fairness of the statements. This situation often arises when there are significant uncertainties or restrictions imposed by the client that prevent the auditor from collecting appropriate evidence. This differs from other types of opinions: an unmodified opinion indicates that the auditor believes the financial statements are free of material misstatement; a qualified opinion is given when there is a specific area of concern but the financial statements as a whole are fairly presented; an adverse opinion is issued when the financial statements contain material misstatements that are pervasive. In summary, a disclaimer of opinion serves to inform stakeholders that the auditor could not obtain enough evidence to support any opinion, highlighting the critical nature of evidence in the audit process.