Professional Documents
Culture Documents
Auditors Report
•An auditor’s report is the independent examination of and expression of opin-
ion on the financial statements of the company by appointed auditors in pur-
suance of that appointment and in compliance with any statutory obliga-
tions.
•The auditor’s report is the end product of an audit examination communicated
to the users of the f/statements, the auditor’s conclusion regarding;
ing principles.
Explanatory Paragraph of qualified reports
Sony corporation has not presented segment information for each of the three
years in the period ended march 3, 2020. The presentation of segment infor-
mation concerning operations in different industries, and foreign operations
and export sales is required by generally accepted accounting principles for a
complete presentation of the consolidated f/statements.
Opinion Paragraph
In our opinion, “except for” the omission of the segment information as dis-
cussed in the third paragraph of this report, the f/statements audited by us
presents fairly, in all material respects, the financial position of sonny corpo-
ration and its consolidated subsidiary at March 31, 2019 and 2020, and the
results of its operations and their cash flows for each of the three years in the
period ended march 31, 2020, in conformity with generally accepted account-
ing principle.
Auditors may issue qualified audit opinion when:
In our opinion, because of the effects of the matters discussed in the pre-
ceding paragraph, the f/statements referred to above do not present fairly,
in conformity with GAAP the financial position of XYZ company as of
Dec., 31, 20x9, or the results of its operations or its cash flows for the year
then ended.
4. Disclaimer of opinion
•A disclaimer of opinion means giving no opinion as to the status of the finan-
cial statements under audit.
•Auditors issue a disclaimer whenever:
1.Auditors are un able to form an opinion or have not formed an opinion as to
the fairness of presentation of the financial statements due to significant scope
limitations either by substantial circumstances and/or by client and this limita-
tions of scope precludes (prevents) the auditors’ compliance with generally ac-
cepted auditing standards and
2.When a material uncertainty affects the financial statements.
Since the Co. did not take physical inventories and we were not able to ap-
ply other auditing procedures to satisfy ourselves as to inventory quanti-
ties and the cost of property and equipment, the scope of our work was not
sufficient to enable us to express, and we do not express, an opinion on
these financial statements.
• Independent auditors report the phrase “Financial statements present fairly,
in all material respects”
The auditors cannot say that the “statements present exactly or correctly
the financial position or operating results” since many of items in the
financial statements cannot be measured exactly.
• The meaning of “present fairly” in dependent auditor’s report is to
state the fairly stated financial statements are
1. Prepared in accordance with accounting principles that have general accep-
tance and are appropriate in the circumstance
2. Information of matters that may affect their use, understanding and interpre-
tation are classified, summarized and presented in a reasonable manner, nei-
ther too detailed nor too condensed.
3. Prepared to reflect transactions and events within a range of reasonable lim-
its.
End of Chapter six
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