What Is an Unqualified Opinion?

An unqualified opinion is an independent auditor's judgment that a company's financial statements are fairly and appropriately presented, without any identified exceptions, and in compliance with generally accepted accounting principles (GAAP). An unqualified opinion is the most common type of auditor's report. Like any auditor’s opinion, it does not judge the financial position of the company or interpret financial data. It indicates that as a result of the testing done during the audit, the independent auditor has enough information to conclude that the company's financial statements conform to GAAP and fairly present the company's financial position for the statement time frame. It is issued when the auditor believes that all changes, accounting policies and their application and effects, have accurately been disclosed.

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What Is an Unqualified Opinion?

Example of an Unqualified Opinion

An unqualified opinion letter in an audit report might state “In our opinion, the financial statements give a true and fair view of the financial position of XYZ Company.”

Unqualified Opinion vs. Other Opinions

An unqualified opinion is compared to a qualified opinion, in which the auditor has determined that there is a material issue with regard to accounting policies – but one that does not misrepresent the factual financial position. Auditors typically qualify reports, with statements like "except for the following adjustments," when they have insufficient information to verify certain aspects of the transactions and reports being audited. Qualified opinions may also be issued if the financial statements deviate from GAAP or have inadequate disclosure. If the financial statements have been truly misrepresented or misstated, the auditor might report an adverse opinion or a disclaimer of opinion.