A change that the auditor agrees with from one generally accepted accounting principle to another generally accepted accounting principle that has a pervasive effect on net income usually results in an adverse opinion by the auditors.

Question

Quizplus · Accepted Answer

A change from one GAAP to another GAAP that has a pervasive effect on net income and is properly disclosed does not necessarily result in an adverse opinion. The auditor may issue a qualified or an unqualified opinion with an emphasis of matter paragraph explaining the change.

A Change That the Auditor Agrees with from One Generally