Prior to audit engagement mgt has put a limitation on scope and thus auditor thinks he will give CASE 1 DISCLAIMER CASE 2 QUALIFIED i think he should reject in case 1 and accept in case 2 as in book the word mentioned is DISCLAIMING AN OPINION ON FS but in video u told if report is to be modified than dont accept…in book it is written only DISCLAIMING not qualified…plz clarify

1 answer

Ravi Staff March 11, 2018

From SA 210
Limitation on Scope Prior to Audit Engagement Acceptance
If management or those charged with governance impose a limitation on the scope of the auditor‟s work in the terms of a proposed audit engagement such that the auditor believes the “limitation will result in the auditor disclaiming an opinion on the financial statements, the auditor shall not accept such a limited engagement as an audit engagement, unless required by law or regulation to do so.
From above, Yes i agree if resulting is disclaimer then he should not accept and if result is qualified he can accept and qualify in future, should inform management about consequences while accepting


Please login here to Submit Answer