Document ID: chunk:federal_register_of_legislation:F2023C01137:body:0:p6
Version: federal_register_of_legislation:F2023C01137
Segment Type: other
Provision Reference: 
Character Range: 15256–18326

to express a qualified opinion or to disclaim an opinion on the financial report, the auditor shall request that management remove the limitation.

12.               If management refuses to remove the limitation referred to in paragraph 11 of this Auditing Standard, the auditor shall communicate the matter to those charged with governance, unless all of those charged with governance are involved in managing the entity,[2] and determine whether it is possible to perform alternative procedures to obtain sufficient appropriate audit evidence.

13.               If the auditor is unable to obtain sufficient appropriate audit evidence, the auditor shall determine the implications as follows:

(a)                If the auditor concludes that the possible effects on the financial report of undetected misstatements, if any, could be material but not pervasive, the auditor shall qualify the opinion; or

(b)                If the auditor concludes that the possible effects on the financial report of undetected misstatements, if any, could be both material and pervasive so that a qualification of the opinion would be inadequate to communicate the gravity of the situation, the auditor shall:

(i)                 Withdraw from the audit, where practicable and possible under applicable law or regulation; or (Ref: Para. A13)

(ii)               If withdrawal from the audit before issuing the auditor's report is not practicable or possible, disclaim an opinion on the financial report.
(Ref. Para. A14)

14.               If the auditor withdraws as contemplated by paragraph 13(b)(i) of this Auditing Standard, before withdrawing, the auditor shall communicate to those charged with governance any matters regarding misstatements identified during the audit that would have given rise to a modification of the opinion.  (Ref: Para. A15- Aus A15.1)

Other Considerations Relating to an Adverse Opinion or Disclaimer of Opinion

15.               When the auditor considers it necessary to express an adverse opinion or disclaim an opinion on the financial report as a whole, the auditor's report shall not also include an unmodified opinion with respect to the same financial reporting framework on a single financial statement or one or more specific elements, accounts or items of a financial statement.  To include such an unmodified opinion in the same report[3] in these circumstances would contradict the auditor's adverse opinion or disclaimer of opinion on the financial report as a whole.  (Ref: Para. A16)

Form and Content of the Auditor's Report When the Opinion is Modified

Auditor's Opinion

16.               When the auditor modifies the audit opinion, the auditor shall use the heading "Qualified Opinion," "Adverse Opinion," or "Disclaimer of Opinion," as appropriate, for the Opinion section.  (Ref: Para. A17–A19)

Qualified Opinion

17.               When the auditor expresses a qualified opinion due to a material misstatement in the financial report, the auditor shall state that, in the auditor's opinion, except for the effects of the