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 unqualified opinion with an explanatory paragraph describing the going-concern uncertainty.

Question

Quizplus · Accepted Answer

If the auditors have concerns about the entity's ability to continue as a going concern, but the disclosure is adequate and there is no other basis for modifying the report, they would generally issue an unqualified opinion with an explanatory paragraph describing the going-concern uncertainty. This allows the auditors to express their concerns while still acknowledging that the financial statements are fairly presented. The other options (disclaiming an opinion or expressing an adverse opinion) would only be appropriate if the financial statements were materially misstated or incomplete.

Independent Auditors Must Consider Whether the Entity Has the Ability