The document discusses different types of audit reports that can be issued by an auditor: - Unqualified or clean report is issued when no issues are found during the audit. - A qualified report is issued when the auditor has reservations but the financial statements are still fairly presented subject to the auditor's qualifications. - A disclaimer is issued when the auditor is unable to express an opinion due to limitations or uncertainties. - An adverse opinion is issued when the financial statements are materially misstated. - A compartmental report is issued when the auditor can express an opinion on some but not all aspects of the financial statements.

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Types of Audit report:
Unqualified or clean report:
Any condition does not impose
or he does not comment specifically but the
express his opinion in the report. It is right.
This is called unqualified or clean report.
Qualified Report:-
When an auditor express his
opinion in the report which is condition and
commutative. This is called qualified report
but when he submit the report then he
mentions every problem
Auditor Report 1

2. Report with Disclaimer:
It remains different opinion between auditor and
authority on the expressed information and an auditor
does not like to take any responsibility about this matter
on. If he is unable to give his opinion. Then he will
express that report is called report with disclaimer.
Negative Report:
When an auditor express that, there and reverent
belief has not been published in the amount of business
then it is called negative report.
Compartmental Report:
When an auditor can not organized and express
his opinion on financial description but when he less
there is few error in the financial description depend on
its he expresses his opinion is called compartmental
report.
Auditor Report 2

3. Auditor’s opinion:
The auditor’s opinion is the most
important part of the audit report
that is provided with company
accounts. The auditor’s opinion may
be Unqualified, Qualified, Disclaimer
or Adverse. The auditor expresses
his opinion about the financial
information reported in annual
statements of accounts.
Auditor Report 3

4. Unqualified Opinion:
An unqualified or “clean” opinion means that the
financial statements are fairly presented in the
auditors’ opinion, are free of material misstatements,
and have been prepared in accordance with
generally accepted accounting principles,
consistently applied. That’s respect with regard to:
 The final accounts being in agreement with the
books of account.
 The final accounts being true and fair summary.
 The discloser of information in final accounts as per
the requirements.
Auditor Report 4

5. Qualified Opinion:
 He is not satisfied in material respects with
matters concerning the areas of report.
 His not satisfaction is die to circumstance such
as limitations imposed on scope of audit work,
disagreement with management or uncertainty
over financial information .
 The effect of his disagreement, uncertainty or
limitation is not as material as it compels the
auditor to give an adverse opinion or to state a
disclaimer
Auditor Report 5

6. Adverse Opinion:
In an adverse opinion, the auditors are
clearing stating their opinion that the
financial statements are not fairly presented
in accordance with the accounting and
reporting principles intended, or that there
are material misstatements. There will be a
paragraph explaining the reason for their
negative opinion.
Auditor Report 6

7. Disclaimer:
A disclaimer indicates that the auditors were
engaged to perform an audit, but are unable to
express an opinion. This may be due to a lack
of independence on the auditors’ part;
limitations on the scope of the audit, for
example, the inability to obtain sufficient
evidence; or may be due to substantial doubts
about the entity as a “going concern”, or
material uncertainties for which the auditors
were unable to obtain reasonable assurance
about the outcome.
Auditor Report 7

8. When to qualify:
The auditor should not use the weapon of qualifying his report
on petty ground. He must qualify the report only if his
non-satisfaction in respect matter. The following matters are
examples requiring qualification in audit report:
 Non –provision for depreciation
 Inadequate provision made for bad and doubtful debts
 Valuation of investment at cost price when the market price
is far below it.
 Contingent liability not disclosed
 Violation of provisions of company law-payment of
remuneration to managerial personnel in excess of limits
Auditor Report 8
without approval.

9. How to qualify:
While drafting a qualified report, the auditor should bear in mind
the following points:
 It should be clear and unambiguous so that the readers
understand what the auditor wants them to know .
 It should be concise, but conciseness should not sacrifice clarity
 It should be specific and to the point. The amount involved if
any , should be clearly stated.
 It should state the effect of matter under report on the
accounts.
 The opinion of the auditor expressed in the report should not be
capable of misinterpretation.
Auditor Report 9

10. Precautions on Report Writing
 When a Report on a subject is desired to be written, the writer
should be a competent person being familiar with the issue.
 A Report should be written in peaceful atmosphere giving full
concentration to the matter.
 The writer should have easy access to the related material, files
and data which he can reflect in his Report.
 The writer in the report should also mention certain important
facts, which are not mentioned in the file and were verbally
discussed or got through on the telephone.
 Before giving final shape to the Report it should be got approved
from the Head of the Section.
 While writing a Report it is also important that the source of
information, with date, place and quantity be mentioned.
Auditor Report 10

11. Report writing
Auditor’s report
To
The members of XYZ Limited
We have audited the financial statements on page …. To
… in accordance with approved Auditing Guidelines.
In our opinion the financial statements give a true and fair
view of the state of company’s affairs at Dec,31,2010
and of it s profit and changes in financial position for
the year ended in accordance with generally accepted
accounting principles applied on a basis consistent with
that on the preceding year.
Auditor Report 11

12. We further report as required by the companies
act 1994 that in our opinion
1. We have obtained all the information and
explanation we considered necessary for the
purposes of our audit.
2.The balance sheet and profit and loss account
are drawn up in conformity with the law.
3.Subject to the uncertainty referred to above the
balance sheet exhibits a true and fair view of the
state of the company’s affairs according to the
best of our information and explanation given to
use and as shown by the books of the company
4. Proper books of account have been kept by the
company as required by law
Dhaka ABC and Co
15th July 2011
Auditor Report
Charted Accountants 12

13. Qualified report
Auditor’s Report
To the members of XYZ Limited
We have audited the financial statements on page ….
to …in accordance with approved Auditing standards.
As discussed in Note- to financial statements the
company is defendant in a lawsuit alleging
infringement of certain patent rights and claiming
royalties and punitive damages. The company has
filed counter action, and preliminary hearings and
discovery proceedings on both actions are in
progress. Company officers and counsel believe the
company has a good chance of prevailing but the
ultimate outcome of the lawsuit cannot presently be
determined and no provision for any liability that may
result has been made in the financial statement.
Auditor Report 13

14. In our opinion, subject to the effect of such
adjustments, if any might have been required had the
outcome of the uncertainty referred to in the
preceding paragraph been known, the financial
statements… give a true and fair view of the state of
the company’s affairs at 31st Dec 2010 and of its profit
and changes in financial position for the year ended in
accordance with generally accepted accounting
principles applied on a basis consistent with that the
preceding year
Auditor Report 14

15. We further report as required by the companies act
1994 that in our opinion
1. Except as stated above we have obtained all the
information and explanations considered necessary
for the purposes of our audit.
2.The balance sheet and profit and loss account are
drawn up in conformity with law.
3.The balance sheet exhibits a true and fair view of
the state of the company’s affair according to the best
of our information and explanation given to use and
as shown by the books of the company
4. Proper books of account have been kept by the
company as required by the companies act1994
Dhaka ABC and Co
15th July 2011 Charted Accountants
Auditor Report 15