Auditor’s Responsibilities for the Audit of the Financial Statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.
Read the preceding paragraphs to answer the following:
a. How does the information in the preceding paragraphs compare to the information in the Basis for Opinion and Auditor’s Responsibility sections in the standard unmodified opinion audit report example for a nonpublic company shown in Figure 3-1 (p. 49)?
b. How does the information in the preceding paragraphs compare to the information
in the Basis for Opinion section in the standard unmodified opinion audit report ex-
ample for a public company shown in Figure 3-3 (p. 54)?
c. Discuss which of the three audit reports, in your opinion, provides greater auditor
communications to users of the financial statements.