Piecemeal Opinion

AAA

DEFINITION of 'Piecemeal Opinion'

An auditor's assessment of the accuracy of a portion of a company's financial statements. An auditor might provide a piecemeal opinion in a situation where complete information is not available. Generally Accepted Accounting Principals (GAAP) no longer allow auditors to provide piecemeal opinions.

INVESTOPEDIA EXPLAINS 'Piecemeal Opinion'

When they were allowed, piecemeal opinions had to be extremely specific in order to be credible since many components of a company's financial statements are interrelated. For example, according to former SEC Chief Accountant Carman G. Blough, it might be possible to express a piecemeal opinion on the accuracy certain items listed on a company's balance sheet, but it would not be possible to express a piecemeal opinion on the balance sheet as a whole because of the balance sheet's relationship with other financial statements, such as the income statement.

RELATED TERMS
  1. Unqualified Audit

    Also known as a complete audit. An audit that has been performed ...
  2. Independent Auditor

    A certified public accountant who examines the financial records ...
  3. Generally Accepted Auditing Standards ...

    A set of systematic guidelines used by auditors when conducting ...
  4. Internal Audit

    The examination, monitoring and analysis of activities related ...
  5. Audit

    1. An unbiased examination and evaluation of the financial statements ...
  6. Generally Accepted Accounting Principles ...

    The common set of accounting principles, standards and procedures ...
RELATED FAQS
  1. What is the difference between IAS and GAAP?

    To answer this question, we must first define what IAS and GAAP are, in order to get a better grasp of the function they ... Read Full Answer >>
  2. Did the repeal of the Glass-Steagall Act contribute to the 2008 financial crisis?

    The repeal of the Glass-Steagall Act was a minor contributor to the financial crisis, if it contributed to the crisis at ... Read Full Answer >>
  3. How does operating leverage affect business risk?

    In finance, companies assess their business risk by capturing a variety of factors that may result in lower-than-anticipated ... Read Full Answer >>
  4. How can I calculate degree of operating leverage on Excel?

    The degree of operating leverage measures how a given percent change in sales will affect a company's earnings before interest ... Read Full Answer >>
  5. How does a contra-asset account differ from a contra-liability account?

    A contra-asset account is an asset account with a credit balance and reduces the total assets on a company's balance sheet, ... Read Full Answer >>
  6. Why is an increase in capital stock on a company's balance sheet a bad sign for stockholders?

    An increase in the total of capital stock showing on a company's balance sheet is bad for investors, because it represents ... Read Full Answer >>
Related Articles
  1. Bonds & Fixed Income

    Accounting Rules Could Roil The Markets

    FAS 142 is an accounting rule that changes the way companies treat goodwill. Be aware of the impact it has on reported earnings to avoid making bad investment decisions.
  2. Markets

    A Clear Look At EBITDA

    This measure has its benefits, but it can also present earnings through rose-colored glasses.
  3. Fundamental Analysis

    Impairment Charges: The Good, The Bad And The Ugly

    Impairment charge is a term for writing off worthless goodwill, but you need to know what its potential impact is on EPS.
  4. Fundamental Analysis

    Detecting Accounting Manipulation

    "One-time charges" and "investment gains" are two strategies companies can use to distort their numbers.
  5. Economics

    Explaining the Value Chain

    A model of how businesses receive raw materials as input, add value to the raw materials, and sell finished products to customers.
  6. Fundamental Analysis

    Explaining Variance

    Variance is a measurement of the spread between numbers in a data set.
  7. Investing Basics

    Understanding Risk-Return Tradeoff

    The essence of risk-return tradeoff is embodied in the common phrase “no risk, no reward.”
  8. Economics

    What Is Supply?

    Supply is the amount of goods a producer is willing to produce at a given price, and is one of the most basic concepts in economics.
  9. Economics

    Modified Internal Rate of Return (MIRR)

    Modified internal rate of return (MIRR) is a variant of the more traditional internal rate of return calculation.
  10. Fundamental Analysis

    What is Quantitative Analysis?

    Quantitative analysis refers to the use of mathematical computations to analyze markets and investments.

You May Also Like

Hot Definitions
  1. Coupon

    The interest rate stated on a bond when it's issued. The coupon is typically paid semiannually. This is also referred to ...
  2. Ghosting

    An illegal practice whereby two or more market makers collectively attempt to influence and change the price of a stock. ...
  3. Redemption

    The return of an investor's principal in a fixed income security, such as a preferred stock or bond; or the sale of units ...
  4. Standard Error

    The standard deviation of the sampling distribution of a statistic. Standard error is a statistical term that measures the ...
  5. Capital Stock

    The common and preferred stock a company is authorized to issue, according to their corporate charter. Capital stock represents ...
Trading Center