Question

When the auditor is unable to determine the amounts associated with the illegal acts of client personnel because of an inability to obtain adequate evidence, the auditor should issue a(n)

a. Subject to qualified opinion.
b. Disclaimer of opinion.
c. Adverse opinion.
d. Unqualified/unmodified opinion with a separate explanatory/emphasis-of-matter paragraph.

Answer 1

When the auditor is unable to determine amounts associated with illegal acts due to insufficient evidence, the auditor should issue a disclaimer of opinion.

Step-by-step explanation:

When the auditor is unable to determine the amounts associated with the illegal acts of client personnel because of an inability to obtain adequate evidence, the auditor should issue a disclaimer of opinion. A disclaimer of opinion is issued when the auditor is unable to obtain sufficient appropriate audit evidence and as a result, the auditor is unable to express an opinion on the financial statements. It indicates that the auditor is not able to provide any assurance on the accuracy or completeness of the financial statements.