The "unqualified report with explanatory paragraph" or the "unqualified report with modified wording"
A) arise as a result of an incomplete audit.
B) arise when the financial statements are not quite "presented fairly."
C) meet the criteria of a complete audit with satisfactory results but further explanation is required.
D) meet the criteria of a complete audit but with unsatisfactory results.

Question

Quizplus · Accepted Answer

Both the "unqualified report with explanatory paragraph" and the "unqualified report with modified wording" indicate that the financial statements have been audited completely and the results are satisfactory, but further explanation or modification in wording is required to avoid misunderstandings or potential misinterpretations. These types of reports may be issued due to issues related to accounting principles or disclosures, for example. They do not arise as a result of an incomplete audit or unsatisfactory results.

The "Unqualified Report with Explanatory Paragraph" or the "Unqualified Report