Most audit reports contain the analytical and systematic review, assessment, and recommendations made by the auditor

on the business matter. An audit report is commonly performed on the financial aspect of the business as well as on the performance of the company's management. It may also be done on a section, division, department, or on the entire business itself.

A financial audit report is commonly known to the public as it involves the monetary aspect of the company. It is reflected in books that integrate the balance sheet, income statement, equity, and other financial papers along with the auditors review. Stakeholders are the primary set of users of this audit report for they are directly involved in the corporate body. The government is another interested party in this affair because of the rightful taxes due for collection. There are some other concerned parties such as affiliates, competitors, and investors that would also consider it useful.

The report is subsequently provided to a user (such as an individual, a group of persons, a company, a government, or even the general public, among others) as an assurance service in order for the user to make

decisions based on the results of the audit.

INDEPENDENT AUDITORS REPORT

Board of Directors, Stockholders, Owners, and/or Management of ABC Company, Inc. 123 Main St. Anytown, Any Country

We have audited the accompanying balance sheet of ABC Company, Inc. (the Company) as of December 31, 20XX and the related statements of income, retained earnings, and cash flows for the year then ended. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with auditing standards generally accepted in (the country where the report is issued). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 20XX, and the results of its operations and its cash flows for the year then ended in accordance with accounting principles generally accepted in (the country where the report is issued).

AUDITORS SIGNATURE Auditors name and address

Date = Last day of any significant field work This date should not be dated earlier than when the auditor has sufficient audit evidence to support the opinion The report is subsequently provided to a user (such as an individual, a group of persons, a company, a government, or even the general public, among others) as an assurance service in order for the user to make decisions based on the results of the audit.

Limitation of Scope in an Audit Report

The main objective of an audit is to give a true and fair view of a company's state of affairs at a given date. Preparation of the audit report is the last step of an audit cycle. The report renders the auditor's opinion about the truth and fairness of the financial statements. In line with the International Audit Standards, IAS, the report should have a paragraph on the scope of the audit that follows the introductory paragraph. Circumstances Where Limitation of Scope Arises Generally, when the auditor does not receive all information and explanations that he deems necessary for the completion of the audit, limitation of scope arises. The auditor can, therefore, not give an objective conclusion of his analysis with regard to the company's economic status. Management may contribute to the auditor's limitation by refusing to render all information required. Destruction of accounting records also limits the auditor's capability to deliver a judgment.

Qualified Opinion Limitation of scope may lead to either a qualified opinion or a disclaimer by the auditor in the report. When the limitation is material, but not fundamental, the auditor renders a qualified opinion. This means that all other matters in the audit are okay except for the limitation of scope in the audit process. The auditor, therefore, has some reservations about the truth and fairness of the financial statements as a reflection of the firm's economic status. Disclaimer of Opinion A disclaimer of opinion arises when the limitation is so fundamental that the auditor is not able to give an opinion. Due diligence is one of the duties of an auditor; if the auditor feels that there are important records, materials or explanations missing that are crucial to the audit, a disclaimer of opinion is imperative. The auditor should expressly state the nature of the limitation and possible adjustments to the financial statements that can remove the limitation. Materiality and Fundamentality Before issuing a modified report -- qualified or disclaimer of opinion -- the auditor must evaluate the materiality and fundamentality of the limitation. Limitation of scope is material if the inadequacy may alter the view given by the financial statements on the economic status of the firm. Limitation of scope is fundamental when the inadequacy is crucial and can totally alter the interpretation of the financial statements or even make them meaningless.

What Are the 4 Types of Audit Report ?

An audit report is an appraisal of a small businesss complete financial status. Completed by an independent accounting professional, this document covers a companys assets and liabilities, and presents the auditors educated assessment of the firms financial position and future. Audit reports are required by law if a company is publicly traded or in an industry regulated by the Securities and Exchange Commission (SEC). Companies seeking funding, as well as those looking to improve internal controls, also find this information valuable. There are four types of audit reports.

Unqualified Opinion Often called a clean opinion, an unqualified opinion is an audit report that is issued when an auditor determines that each of the financial records provided by the small business is free of any misrepresentations. In addition, an unqualified opinion indicates that the financial records have been maintained in accordance with the standards known as Generally Accepted Accounting Principles (GAAP). This is the best type of report a business can receive. Typically, an unqualified report consists of a title that includes the word independent. This is done to illustrate that it was prepared by an unbiased third party. The title is followed by the main body. Made up of three paragraphs, the main body highlights the responsibilities of the auditor, the purpose of the audit and the auditors findings. The auditor signs and dates the document, including his address. Qualified Opinion In situations when a companys financial records have not been maintained in accordance with GAAP but no misrepresentations are identified, an auditor will issue a qualified opinion. The writing of a qualified opinion is extremely similar to that of an unqualified opinion. A qualified opinion, however, will include an additional paragraph that highlights the reason why the audit report is not unqualified. Adverse Opinion The worst type of financial report that can be issued to a business is an adverse opinion. This indicates that the firms financial records do not conform to GAAP. In addition, the financial records provided by the business have been grossly misrepresented. Although this may occur by error, it is often an indication of fraud. When this type of report is issued, a company must correct its financial statement and have it re-audited, as investors, lenders and other requesting parties will generally not accept it. Disclaimer of Opinion On some occasions, an auditor is unable to complete an accurate audit report. This may occur for a variety of reasons, such as an absence of appropriate financial records. When this happens, the auditor issues a disclaimer of opinion, stating that an opinion of the firms financial status could not be determined.