Final answer:
An adverse opinion should be issued when an auditor finds a pervasive material departure from GAAP in a company's financial statements, indicating that the financial statements are not reliable.
Step-by-step explanation:
When an auditor determines that a company's financial statements contain a pervasively material departure from Generally Accepted Accounting Principles (GAAP), the appropriate audit opinion to issue is an adverse opinion. An adverse opinion is given when the financial statements of a company are misrepresented to the point where the financial health of the company cannot be accurately determined. This type of opinion is a strong indicator to stakeholders that the company's financial statements are not reliable.
In contrast, a disclaimer opinion is provided when the auditor lacks sufficient information to form an opinion on the financial statements, an unmodified opinion (also known as an unqualified opinion) indicates that the financial statements are presented fairly in all material respects, and a qualified opinion suggests that except for one or more specific areas, the financial statements are presented fairly.