An investor is reading the financial statements of the Stankey Corporation and observes that the statements are accompanied by an auditor's unqualified report. From this, the investor may conclude that:
A)any disputes over significant accounting issues have been settled to the auditor's satisfaction.
B)the auditor is satisfied that Stankey will be highly profitable in the future.
C)the auditor is certain that Stankey's financial statements have been prepared accurately and that all account balances are precisely correct.
D)the auditor has determined that Stankey's management is not qualified to lead the company.

Question

Quizplus · Accepted Answer

An auditor's unqualified report indicates that the auditor is satisfied with the financial statements and has not found any major issues or disputes with the accounting practices of the company. It does not make any statement about future profitability, precise accuracy of account balances, or the qualification of management.

An Investor Is Reading the Financial Statements of the Stankey