If a company receives an unqualified audit opinion, it means the auditors
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A. B. C. D.C
The correct answer is C. When a company receives an unqualified audit opinion, it means that the auditors are providing assurance that the company's financial statements fairly present the company's financial performance and position.
An audit is an independent examination of a company's financial statements, accounting records, and internal control systems conducted by external auditors. The primary objective of an audit is to express an opinion on whether the financial statements are prepared in accordance with the applicable financial reporting framework (such as Generally Accepted Accounting Principles or International Financial Reporting Standards) and are free from material misstatements.
An unqualified audit opinion, also known as a clean opinion, is the best type of opinion a company can receive from auditors. It indicates that the auditors have reviewed the company's financial statements and found them to be free from material misstatements or departures from the financial reporting framework. It also means that the auditors believe the financial statements fairly present the company's financial performance and position.
Answer A is incorrect because although an unqualified opinion provides some level of assurance, it does not guarantee that the financial statements are free from all misstatement or fraudulent accounting. Auditors perform tests and procedures to provide reasonable assurance, but they cannot guarantee the absence of all misstatements.
Answer B is incorrect because an unqualified audit opinion does not provide assurance about the company's future financial viability. It focuses on the accuracy and fairness of the financial statements at the time of the audit, rather than predicting future performance.
Answer D is incorrect because an unqualified opinion indicates that the auditors have completed a full audit and are qualified to express an opinion on the financial statements. It signifies that the auditors have performed the necessary procedures and obtained sufficient evidence to support their opinion.
In summary, an unqualified audit opinion means that the auditors have reviewed the company's financial statements, found them to be accurate and in compliance with the applicable financial reporting framework, and believe they fairly present the company's financial performance and position.