Appendix: Types of audit reports that we can issue
An audit report will be either standard or non-standard.20 A non-standard audit report is one that contains:
- an adverse opinion;
- a qualified audit opinion;
- an emphasis of matter paragraph; and/or
- an “other matter” paragraph.
An adverse opinion is quite rare and means that the auditor disagrees with the entity. It indicates that, in the auditor’s professional opinion, the underlying information and assumptions in the long-term plan are unreasonable.
An adverse opinion or qualified opinion can also be called a modified opinion. An auditor will include an emphasis of matter paragraph or an “other matter” paragraph in the audit report to draw attention to:
- a breach of law; or
- a matter or matters presented or disclosed that are of such importance that they are fundamental to readers’ understanding of the audited information.
An emphasis of matter paragraph does not necessarily mean that the auditor has found anything wrong. Instead, the auditor wants to draw readers’ attention to a matter or matters that are fundamental to understanding the long-term plan.
An audit report can contain more than one modification to the audit opinion or more than one emphasis of matter paragraph.
20: For a plain-language explanation of the different forms of audit report, see our blog post “The Kiwi guide to audit reports”, at oag.parliament.nz.