Question

The auditor has serious concern about the going concern of the company. It is dependent on company's obtaining a working capital loan from a bank which has been applied for. The management of the company has made full disclosure of there facts in the notes to the balance sheet. The auditor is satisfied with the level of disclosure. He should issue ____________ .

• A. Unqualified opinion
• B. Unqualified opinion with reference to notes to the accounts
• C. Qualified opinion
• D. Disclaimer of opinion

Answer 1

The correct option is B Unqualified opinion with reference to notes to the accounts

Unqualified report is a clean report by the auditor. He has no reservations on the financial statements based on the evidences provided by the auditee.

In the given question, the auditor is satisfied with the level disclosure by the company and hence, auditor may provide an unqualified report accordingly.