Final answer:
The auditor's decision to issue a qualified opinion on Tech Company's financial statements would likely stem from insufficient audit evidence regarding the outcome of pending litigation, which is a significant uncertainty potentially affecting the financial statements.
Step-by-step explanation:
The auditor's decision to issue a qualified opinion on Tech's financial statements would most likely result from the auditor not being able to obtain sufficient appropriate audit evidence about the outcome of the pending litigation, which constitutes an uncertainty.
When an uncertainty is disclosed by a company, it implies there are events or conditions that may cast significant doubt on the company's ability to continue as a going concern, or that may result in a material adjustment to the carrying value of assets and liabilities. If such uncertainties are material and pervasive and the auditor cannot obtain sufficient evidence, they may decide to issue a qualified opinion indicating that, except for the effects of the matter to which the qualification relates, the financial statements give a true and fair view of the financial position of the company.
A qualified opinion suggests that the financial statements may not be entirely in accordance with generally accepted accounting principles (GAAP) or International Financial Reporting Standards (IFRS), due to the potential effects of the uncertainty. In contrast, an unqualified opinion indicates that the auditor believes the financial statements are fairly and appropriately presented.