Page 242 - CA Inter Audit PARAM

CA Ravi Taori
As such, the statutory auditor of Delightful Ltd. Should give a disclaimer of opinion.

QNO Effect of Qualification on Basis of Opinion Section Old Course – (N20E/N23M)
705.28 Bhaskar CNO - SA705.060
What an auditor should state in “Basis for opinion” section of auditor’s report and when the auditor

modifies the opinion on the financial statements, what amendments he should make in this section?
Answer An auditor should state in “Basis for Opinion” section of Auditor’s Report as under: Basis for
Opinion:

The auditor’s report shall include a section, directly following the Opinion section, with the heading
“Basis for Opinion”, that:
(e) States that the audit was conducted in accordance with Standards on Auditing;
(ii) Refers to the section of the auditor’s report that describes the auditor’s responsibilities under the
Sas;
(iii) Includes a statement that the auditor is independent of the entity in accordance with the relevant
ethical requirements relating to the audit and has fulfilled the auditor’s other ethical responsibilities
in accordance with these requirements.
(iv) States whether the auditor believes that the audit evidence the auditor has obtained is sufficient
and appropriate to provide a basis for the auditor’s opinion.

Amendments an Auditor should make :

When the auditor modifies the opinion on the financial statements, the auditor shall, in addition to
the specific elements required by SA 700 (Revised):
(f) Amend the heading “Basis for Opinion” required by para of SA 700 (Revised) to “Basis for
Qualified Opinion,” “Basis for Adverse Opinion,” or “Basis for Disclaimer of Opinion,” as
appropriate; and
(ii) Within this section, include a description of the matter giving rise to the modification.

QNO Effect of Disclaimer on Auditor Responsibility Old Course – (M21E/M22R)
705.30 Bhaskar CNO - SA705.060
CA Guru is in the process of preparing the final audit report of JPA Private Limited and would like to disclaim
his opinion on the financial statements due to an inability to obtain sufficient appropriate audit evidence.
How CA Guru shall amend the description of the auditor’s responsibilities as required by SA 700 (Revised)?
Answer Since the auditor, CA Guru, disclaims an opinion on the financial statements due to an inability to
obtain sufficient appropriate audit evidence of JPA Pvt Ltd, the auditor (CA Guru) shall amend the
description of the auditor’s responsibilities required by SA 700 (Revised) to include only the following:

(a) A statement that the auditor’s responsibility is to conduct an audit of the entity’s financial
statements in accordance with Standards on Auditing and to issue an auditor’s report;
(b) A statement that, however, because of the matter(s) described in the Basis for Disclaimer of
Opinion section, the auditor was not able to obtain sufficient appropriate audit evidence to provide a
basis for an audit opinion on the financial statements , and
© The statement about auditor independence and other ethical responsibilities required
by SA 700 (Revised)

QNO Limitation on Scope Old Course – (M22M)
705.40 Bhaskar CNO – SA705.120 New Course – (M24R)
While conducting audit of VED Ltd., you as an auditor are not only prevented in completing certain audit
procedures but also are not able to obtain audit evidence even by performing alternative procedures.
How you will deal with this situation?
OR
CA. S, while conducting audit of an entity is facing the following issues: -
i. He has not been provided with necessary support for attending inventory count process of entity
as at year end.
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