Hi everybody!
I am reviewing my material for the Audit test and in reading chapter three (Engagement acceptance and understanding the Assignment) I went over something I believe is wrong. I checked with the course help desk and the guy agreed with me on thinking it might be a misspell. Anyway, this is on the "Opening balances" topic - effect on the Auditor's report". It states that the inability of the auditor to obtain sufficient appropriate audit evidence regarding opening balances may result in one of the two as follows:
The 1st option we have is a "qualified or disclaimer", as appropriate (fine, I understood that one) but then the second one bellow (for the Balance Sheet part) is where I was left wondering...
2nd - A qualified or disclaimer, as appropriate, regarding the results of operation and cash flows, and unmodified regarding the financial position???
How can an auditor give an unmodified opinion on the balance sheet if he/she was unable to obtain sufficient appropriate audit evidence regarding the opening balances? Shouldn’t the opinion be qualified/disclaimed as well on that particular report? The only thing I can think of is that the auditor might somehow know that the opening balance was immaterial and hence the unmodified opinion BUT the topic says the case is about the inability to obtain evidence about such balance so this would not be possible anyway.
Sorry if I sound redundant or confusing but English is not my first language. I appreciate any help! :)