In which of the following situations would auditors ordinarily choose between expressing a qualified opinion or an adverse opinion on the entity's financial statements?
A)The auditors did not observe the entity's physical inventory and are unable to become satisfied as to its balance by other auditing procedures.
B)The financial statements fail to disclose information that is required by generally accepted accounting principles.
C)The auditors are asked to report only on the entity's balance sheet and not on the other basic financial statements.
D)Events disclosed in the financial statements cause the auditors to have substantial doubt about the entity's ability to continue as a going concern.

Question

Quizplus · Accepted Answer

When financial statements fail to disclose information required by GAAP, auditors must decide between a qualified opinion (if the omission is not pervasive) or an adverse opinion (if the omission is pervasive and misleading).

In Which of the Following Situations Would Auditors Ordinarily Choose