THE AUDITOR’S REPORT ON FINANCIAL STATEMENTS Explain the reason for ’’Basis for Disclaimer of

the inability to obtain Opinion’’

sufficient appropriate Explain the reason for the
Unmodified opinion is issued only when the auditor is audit evidence inability to obtain sufficient
satsified that appropriate audit evidence

Responsibilities
a. The FS have been prepared in accordance with the PFRS No modification No modification
for the FS
b. The auditor was able to conduct the audit in accordance
Modified
with PSA ...because of the matter
described in the Basis for
Disclaimer of Opinion section,
Nature of Matter Auditor’s
No modification the auditor was not able to
Material but NOT Material AND Responsibilities
Giving Rise to obtain sufficient appropriate
Pervasive Pervasive evidence to provide a basis for
the Modification an audit opinion on the financial
Material statements...
Qualified Opinion Adverse Opinion
Mistatement
Disclaimer of
Scope Limitation Qualified Opinion
Opinion Going Concern

Material Misstatement/Departure from PFRS. Any No Material Material Uncertainty

departure from the specific requirements of the reporting Uncertainty Exists
framework will cause the FS to contain material ✓ Significant doubt
misstatement. ✓ Based on audit
evidence, material
✓ Significant doubt
Scope Limitation. When the auditor is unable to perform uncertainty exists
✘ Based on audit
necessary audit procedures required by PSA or the auditor is ✓ Adequate disclosure
evidence, NO
unable to obtain sufficient appropriate evidence about an – unmodified opinion
material uncertainty
assertion because of the restrictions imposed by the Going Concern with ”Material
Appropriate exists
Uncertainty Related to
management (client imposed scope limitation) or because of ✓ Adequate disclosure
Going Concern”
limitation brought about by the circumstances (circumstance – unmodified opinion
section
imposed scope limitation). with ”Going Concern”
✓ Inadequate
section
Material but NOT Pervasive. Significant enough to affect disclosure – qualified
or adverse opinion
the readers of the FS, but not enough to overshadow the fair
presentation of the FS taken as a whole.

Material AND Pervasive. Highly material and there are If the auditor believes that the entity will not be
Going Concern
able to continue as a going concern, FS should
several items in the FS that are affected by the misstatement Inappropriate
not be prepared on a going concern basis
as to render the overall FS materially misleading.

Modification of the Auditor’s Report

Material Misstatement
Qualified Adverse

Modified Modified
’’Qualified Opinion’’ ’’Adverse Opinion’’
...except for the effects ...because of the
of the matter described in significance of the matter
Opinion
the Basis for Qualified described in the Basis for
Opinion section, the Adverse Opinion section,
financial statements the financial statements
present fairly... do not present fairly...

Modified Modified
’’Basis for Qualified ’’Basis for Adverse
Opinion’’ Opinion’’
Basis for Include a description of Include a description of
Opinion the nature of the nature of
misstatements and a misstatements and a
quantification of the quantification of the
financial effects financial effects

Responsibilities
No modification No modification
for the FS
Auditor’s
No modification No modification
Responsibilities

Scope Limitation
Qualified Disclaimer
Modified
’’Disclaimer of Opinion’’
Modified
...because of the significance
’’Qualified Opinion’’
of the matter described in the
...except for the
Basis for Disclaimer of Opinion
possible effects of the
section, the auditor has not
Opinion matter described in the
been able to obtain
Basis for Qualified Opinion
sufficient appropriate
section, the financial
eveidentce to provide a basis
statements present
for an audit opinion on the
fairly...
financial statements...

Modified
Basis for
’’Basis for Qualified
Opinion Modified
Opinion’’