24.

Forming an Opinion and Reporting on Financial Statements

1. What is the auditor’s primary basis for the expression of an opinion

on the financial statements?
- The auditor’s primary basis for the expression of an opinion on the
financial statements kay ang auditor kay mo conclude kung ang
finacial statements ba kay free sa material misstatement or kung
about sa fraud or error.
2. When should the auditor express an unmodified opinion on the
financial statements?
- The auditor should express an unmodified opinion on the financial
statements kung ang auditor ni conclude na ang mga financial
stetemenys na na prepare kay in accordance saa pag apply sa
financial reporting framework.
3. What course of action should the auditor take if it is found that
financial statements prepared are nor fairly presented?
- The course of action should an auditor take if it is found that the
financial statements prepares are not fairly presented kay ang
auditor dapat e modify iyang opinion sa report in accordance with
PSA 705.

“If financial statements prepared in accordance with the

requirements of a fair presentation framework do not achieve fair
presentation, the auditor shall discuss the matter with
management and, depending on the requirements of the
applicable financial reporting framework and how the matter is
resolved, shall determine whether it is necessary to modify the
opinion in the auditor’s report in accordance with PSA 705
(Clarified).
4. What are the basic elements of the unmodified auditor’s report?
Define or describe each.
- The basic elements of the unmodified auditor’s repot are:
 The title of the auditor's report - The title of the document
should be simple and straight forward and it must include
the word “independent,” for this informs all readers that
the report was created by an unbiased third party

 the addressee -
 the date of the audit report
 the auditor's address
 the auditor's signature -this is where the auditor attaches
his/her signature

5. How should the auditor’s report be dated?

- The auditor should date the audit report no earlier than
the date on which the auditor has obtained sufficient appropriate
evidence to support the auditor's opinion.