The auditor has decided that the financial statements are affected by an uncertainty that is not susceptible to reasonable estimation at the balance sheet date. If this uncertainty is adequately disclosed in the financial statements, the auditor's report should contain a(n):
A) standard unqualified opinion.
B) adverse opinion.
C) disclaimer of opinion.
D) unqualified opinion with an 'emphasis of matter' paragraph.

Question

Quizplus · Accepted Answer

When an uncertainty is adequately disclosed in the financial statements, and the auditor concludes that the financial statements are fairly presented, an unqualified opinion with an 'emphasis of matter' paragraph is appropriate. This paragraph draws attention to the note in the financial statements that discloses the uncertainty, without modifying the auditor's opinion on the overall financial statements.

The Auditor Has Decided That the Financial Statements Are Affected