Modified Audit Reports

NotesPaper exam

So what if the subsidiary report is qualified - is the group too??

It basically depends if the group auditor thinks it is material or not

If so - then the group accounts are qualified too

If not - then no effect

Examples:

  • Group auditor can't get full access to sub

    • Disclaimer of Opinion in component

    • Except for paragraph in group

  • Subs inventory is incorrectly valued

    It is material to the group also

    • Qualified "except for" in component

    • Qualified "except for" in group

  • Going concern doubts over the sub

    It is material to the group also

    • Emphasis of matter paragraph in component

    • Emphasis of matter paragraph in group

  • Going concern doubts over the sub

    It is NOT material to the group though

    • Emphasis of matter paragraph in component

    • No modification in group

NotesPaper exam