Page 197 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori
Wordings of unmodified Conclusion
When the practitioner expresses an unmodified conclusion, the practitioner shall, unless otherwise
required by law or regulation, use one of the following phrases, as appropriate: -
For Fair Presentation Framework: “Based on our review, nothing has come to our attention that causes us to
believe that the financial statements do not give a true and fair view (or do not present fairly, in all material
respects), in accordance with the applicable financial reporting framework,” for financial statements prepared
using a fair presentation framework.
For Compliance Framework:“Based on our review, nothing has come to our attention that causes us to believe
that the financial statements are not prepared, in all material respects, in accordance with the applicable financial
reporting framework,” for financial statements prepared using a compliance framework.
Modified Conclusion:
The practitioner shall express a modified conclusion in the practitioner’s report on the financial statements as a
whole when:
Material Misstatement: The practitioner determines, based on the procedures performed and the evidence
obtained, that the financial statements are materially misstated or
Inability to Obtain Sufficient Evidence: The practitioner is unable to obtain sufficient and appropriate
evidence in relation to one or more items in the financial statements that are material in relation to the financial
statements as a whole.
Impact on Report.
When the practitioner modifies the conclusion expressed on the financial statements, the practitioner shall:
Heading: Use the heading “Qualified Conclusion,” “Adverse Conclusion,” or “Disclaimer of Conclusion,” as
appropriate, for the conclusion paragraph in the practitioner’s report and
Include Basis Paragraph: Provide a description of the matter giving rise to the modification, under an
appropriate heading (for example, “Basis for Qualified Conclusion,” “Basis for Adverse Conclusion,” or “Basis
for Disclaimer of Conclusion,” as appropriate) in a separate paragraph in the practitioner’s report immediately
before the conclusion paragraph (referred to as the basis for conclusion paragraph).
Types of conclusions when financial statements are materially misstated.
If the practitioner determines that the financial statements are materially misstated, the practitioner shall express:
Qualified Conclusion: A qualified conclusion, when the practitioner concludes that the effects of the matter(s)
giving rise to the modification are material, but not pervasive to the financial statements; or
Adverse Conclusion: An adverse conclusion, when the effects of the matter(s) giving rise to the modification
are both material and pervasive to the financial statements.
Wordings of Qualified Conclusion because of a material misstatement
When the practitioner expresses a qualified conclusion on the financial statements because of a material
misstatement, the practitioner shall, unless otherwise required by law or regulation, use one of the following
phrases, as appropriate:

Phrase for Fair Presentation Framework: “Based on our review, except for the effects of the matter(s) described
in the Basis for Qualified Conclusion paragraph, nothing has come to our attention that causes us to believe that
the financial statements do not give a true and fair view (or do not present fairly, in all material respects), in
accordance with the applicable financial reporting framework,” for financial statements prepared using a fair
presentation framework.

Phrase for Compliance Framework: “Based on our review, except for the effects of the matter(s) described in
the Basis for Qualified Conclusion paragraph, nothing has come to our attention that causes us to believe that
the financial statements are not prepared, in all material respects, in accordance with the applicable financial
reporting framework,” for financial statements prepared using a compliance framework.

www.auditguru.in 10.11