The audit opinion is particularly important to stakeholders, as it provides insight into whether the financial statements are true and reliable for decision-making. When an opinion is issued, auditors generally include an explanation for their decision. Because most opinions are unqualified (clean) and issued when an auditor determines that the financial records are appropriate and maintained in accordance with regulations, stakeholders need to take note when modified opinions are issued.

In this article, Audit Analytics explores the differences between an unqualified opinion, which judges financial statements to be presented fairly and appropriately, and a modified opinion, noting which ones should raise a flag for investors.