Question

5.

In which case might an auditor of an issuer render a adverse opinion on internal control?

I. When there is a scope limitation.

II. When there is a material weakness in internal control.

Answer 1

Solution

The correct answer is II. When there is a material weakness in internal control, an auditor of an issuer render a adverse opinion on internal control

A  material weakness is a deficiency, or a combination of deficiencies, in internal control over financial reporting, such that there is a reasonable possibility that a material misstatement of the company's annual or interim financial statements will not be prevented or detected on a timely basis.

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