What is the difference between unmodified opinion and unqualified opinion?


To me there is no difference between the two terms as they concludes one and the same thing. Auditing Standards use both terms to mean one and the same thing. But it has been observed that the term Unmodified opinion is used more often in standards instead of Unqualified opinion.

Some authors try to differentiate between these two terms as follows:

Unmodified opinion is the opinion where auditor expresses an opinion that financial statements are presented, in all material respects, in accordance with applicable financial reporting framework.

Unqualified opinion is the opinion where auditor expresses an unmodified opinion (as above) AND attaches an Emphasis of Matter Paragraph.

Simply, unmodified opinion is a clean opinion where as unqualified opinion is a “modified” clean opinion with emphasis of matter paragraph.

But to my mind we should not try to differentiate the terms in such way. The reason is that if we refer to Para 7(d) of ISA – 706 it is clearly stated that if auditor has included an Emphasis of Matter paragraph in the audit report than he must also indicate that opinion has not been modified in respect of the matter emphasized. So, this alone is enough to clear at any confusion regarding unqualified opinion and unmodified opinion. Therefore, both terms mean one and the same thing.

(According to 2010 handbook) The term Unqualified Opinion has not been defined under any pronouncement issued by IAASB where as Unmodified Opinion does have a definition. Also, most widely used term is Unmodified opinion in the pronouncements, however, the term Unqualified opinion has been used in pronouncements related to Other Assurance Engagements and Related Services


  1. There is a difference between unmodified and unqualified. Unmodified can only be issued to a non-issuer/private company while an unqualified opinion can only be issued to a issuer/public company.

    There is an important distinguishable difference in CPA testing.