If an auditor makes a disclaimer of opinion, this means that the auditor is ________.
A) favorable to the company's financial statement matching its performance but notes a few departures from Generally Accepted Accounting Principles (GAAPs)
B) unfavorable about the financial statement representing the company's position
C) unable to draw a conclusion about the accuracy of the company's financial records owing to lack of information
D) favorable of the company's financial statements representing its performance

Question

Quizplus · Accepted Answer

If an auditor makes a disclaimer of opinion, it means that the auditor is unable to draw a conclusion about the accuracy of the company's financial records owing to lack of information. A disclaimer of opinion is issued when the auditor has been unable to obtain sufficient appropriate audit evidence to form an opinion on the financial statements as a whole. It does not indicate whether the auditor is favorable or unfavorable about the financial statements representing the company's position.

If an Auditor Makes a Disclaimer of Opinion, This Means