During audit of FAN Pvt. Ltd., the auditor finds that the company has defaulted on loan repayments and is unable to pay creditors on time. The…
CA Intermediate · Auditing and Ethics · MTP · January 2026
During audit of FAN Pvt. Ltd., the auditor finds that the company has defaulted on loan repayments and is unable to pay creditors on time. The auditor is having doubts over going concern status of the company. The management refuses to make any assessment of its going concern status. Auditor is unable to obtain sufficient appropriate audit evidence regarding management's use of the going concern basis of accounting in the preparation of the financial statements. What implication does this have on the auditor's report?
Suggested Answer and Working Notes:
Correct Answer: Option (B)
Issue a disclaimer or qualified opinion.
Topics: Audit Evidence, Audit Report
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