14.6 Features of unqualified and qualified audit reports

Unqualified Audit Report:

1. Title: The report is titled “Independent Auditor’s Report” or a similar title that indicates it is an independent assessment of the financial statements.
2. Addressee: The report is addressed to the shareholders, board of directors, or other appropriate parties as required by the applicable regulations or engagement terms.
3. Opinion: An unqualified audit report provides an opinion that the financial statements are presented fairly, in all material respects, in accordance with the applicable financial reporting framework.
4. Basis for Opinion: The report explains that the audit was conducted in accordance with the relevant auditing standards, and it describes the auditor’s responsibility and the scope of the audit.
5. Key Audit Matters (optional): In some jurisdictions, an unqualified audit report may include a section highlighting the key audit matters, which are the most significant matters that required the auditor’s attention during the audit.
6. Signature and Date: The report is signed by the independent auditor, indicating their professional certification and the date of the report.

Qualified Audit Report:

1. All the features of an unqualified audit report are included.
2. Opinion: A qualified audit report provides an opinion that the financial statements are presented fairly, except for the effects of a specific matter or limitation described in the report.
3. Basis for Qualified Opinion: The report explains the specific reasons for the qualification, including any material misstatements or departures from the applicable accounting framework.
4. Scope Limitation (if applicable): If there is a limitation on the scope of the audit that prevented the auditor from obtaining sufficient appropriate audit evidence, it will be described in the report.
5. Emphasis of Matter (optional): A qualified audit report may include an emphasis of matter paragraph to draw attention to a particular matter that is already disclosed in the financial statements but is considered significant by the auditor.
6. Signature and Date: The report is signed by the independent auditor, indicating their professional certification and the date of the report.