Video: Introduction to Audit Opinions

In this lesson, Nick Palazzolo, CPA, dives into the significance and purpose of audit opinions, explaining that these are the end results of any audit engagement and are crucial in providing assurance to clients. He emphasizes that no type of engagement offers absolute assurance to avoid undue liability on the auditor. The lesson covers the objectives of the auditor according to the AICPA – forming an opinion based on evaluation of audit evidence and expressing that opinion clearly in a written report. With a focus on the importance and process of forming audit opinions, this lesson serves as a valuable resource in understanding the culmination of various audit procedures.

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Video Transcript

Instructor: Nick Palazzolo

Nick Palazzolo is head instructor of ExamPrep.ai CPA Review. Nick's teaching style is engaging & upbeat, combining practical Big 4 tax & assurance expertise with years of 1-on-1 coaching. His lessons are concise and emphasize what you need to know to pass. Whether you're a recent grad or working full-time, we’re confident you can conquer your CPA exams with Nick’s review.

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This is the culmination of everything we've been studying for. Well, that just makes it sound super important. Guess what? Cause it is. This is the entire purpose of any engagement. It's the end result. These opinions, all what we've been working for. The client is just paying for this. They're paying for this one opinion, right? Obviously it's a whole report and there's a lot of procedures in order to get there, but this is it. Whether it's right. If we're talking about tax engagements, what's the end result. It could be a complete set of financial statements. If you're preparing them for someone tax return, if it's a tax engagement, a report, if we're dealing with an agreed upon procedure or in the case of an audit, that's an opinion. So these opinions are the end result. Obviously I've got another lesson, which is going to talk about other end results in addition to opinions, but obviously this is the audit exam. And as such, we're going to talk about audit opinions in much more detail. This is the final deliverable and the culmination of all the lessons we've covered up until this point, except for the ones after this, but don't tell anyone these engagement results. If they provide a level of insurance, we'll only provide reasonable assurance or limited assurance. No type of engagement provides absolute assurance. That's a common trick. This would put too much liability on the auditor and the auditor. I don't want that level of responsibility. Now it's enough taking care of a cat. Like, why do I have to have the responsibility for an audit opinion? Absolute assurance. That's too much way too much. What are the objectives of the auditor? These are for the AICPA from their authoritative literature. Your

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Engagement Results

Module: 2 Concepts, 22 Videos

Audit Opinions Overview

0:31

Audit Opinions Objectives

1:08

Introduction to Audit Opinions

1:57

Auditor's Evaluation of Criteria in Determining an Opinion