Auditing An auditor needs to express two different opininons for the consolidate

Question

Auditing

An auditor needs to express two different opininons for the consolidated financial statements and internal controls for public companies, so my question is: If an auditor gives an adverse opinion on a companies internal controls over financial reporting, does this affect their testing of the financial statements. As in, do they test the financial statements more extensively or less extensively due to the poor internal controls or does the adverse opinon given on internal controls not affect how auditors audit the financial statements?

Explanation / Answer

Normally rmanagement is responsible for planning & implementing proper internal control system.
auditor is required to check the effectiveness of internal control system implemented by the management.

Internal control over financial reporting affect testing of financial report but may or may not affect financial statements. Auditor should property analysis n report about weekness and thier possible losses
internal control have direct effect on financial statements. if there is poor internal control sysyem then possibility of fraud & error is high.
so if during the period of audit if auditor finds that proper internal control system is lacking on public company then he should increase his audit procedure. he should obtain sufficient audit evidences to support his audit opinion.
so if there is poor internal control system then auditor should test the financial data more extensivelly in order to minimize the possibility of mis-statements on financial statements.

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