In which one of the following instances would an auditor not issue a disclaimer of opinion?
A)The auditors are not invited to observe the periodic inventory at year-end.
B)There are significant misstatements in the financial statements.
C)There is a significant limitation on the scope of the engagement.
D)There is insufficient evidence for the auditor to form an opinion on the fairness of the financial statements.

Question

Quizplus · Accepted Answer

A disclaimer of opinion is issued when the auditor is unable to form an opinion on the financial statements. Option B indicates that there are significant misstatements in the financial statements. In such a case, the auditor would issue an adverse opinion or a qualified opinion, depending on the materiality and pervasiveness of the misstatements. Therefore, a disclaimer of opinion would not be issued in this scenario.

In Which One of the Following Instances Would an Auditor