Independent auditors must consider whether the entity has the ability to continue as a going concern. If a substantial doubt exists but disclosure is adequate and no other basis exists for modifying the report, the auditors would normally
A)disclaim an opinion.
B)express an adverse opinion.
C)qualify the opinion.
D)express an unmodified opinion with an additional section describing the going-concern uncertainty.

Question

Quizplus · Accepted Answer

If there is a substantial doubt about the entity's ability to continue as a going concern, auditors would normally provide an unmodified opinion, but with an additional section describing the going-concern uncertainty. This is because the auditors believe that the entity will be able to continue its operations even though there is some uncertainty about its future. However, they want to make sure that the users of the financial statements are aware of this uncertainty and its potential impact on the entity's financial health. This is achieved by adding an emphasis-of-matter paragraph to the auditor's report.

Independent Auditors Must Consider Whether the Entity Has the Ability