Conditions that can lead to qualification of audit report

November 05, 2025

Most auditor’s reports are positive and with a statement expressing the auditors’ opinion that the financial statements show a true and fair view and comply with statutory requirements. However, some auditors express this opinion with reservations or express a conversed opinion.

Conditions that can lead to qualification of audit report.

Where proper accounting records have not been kept
Where books of account if kept, do not agree with the audit financial statements prepared by the management
Where proper returns adequate for the purpose of the audit have not been received from branches not visited by the auditors.
Where the information given in the directors reports is not consistent with information in the accounts.
Where auditors are unable to obtain all the information and explanation required for the purpose of their audit.
Where the management of the enterprise did not comply with relevant statutory and professional regulations in preparing the financial statements.
Where there are significant departures form accounting standards.
Where internal control system are not effective within the enterprises
Where there is a doubt as to the going concern concept status of the company.