Piecemeal opinion can be defined as a report issued by an external auditor, whereby the auditor states an opinion about certain line items inside the client’s financial statements. The piecemeal opinion is provided by an external auditor, which emphasizes an opinion limited to a specific line of the item and in a situation where there is no complete information.
Generally Accepted Accounting Principals (GAAP) do not allow auditors to give piecemeal opinions, and it tends to contradict the effect of the general opinion.
Breaking Down: Piecemeal Opinion
In the past, when piecemeal Opinions were allowed, they had to be extremely specific to be credible since a large number of an organization’s financial statements are intertwined.
Let us take, for example, the former chief Accountant Carman G. Blough, who once said that there is a possibility that piecemeal opinions can be expressed based on the accuracy of certain items listed on an organization’s balance sheet. Still, it might not be possible to present a piecemeal opinion on the balance sheet because of the balance sheet’s relationship with the other Financial statements, like the income statement.
External auditors can also be known as independent contractors because they focus on the justice of an organization’s financial statements and ensure it is accurately reflected in the organization’s financial situation.
External auditors declare with insurance if the Financial statements are free of any material misstatement due to error or fraudulent activities.
Piecemeal Opinion express some things that have been done little by little or a stage at a time. Piecemeal can also be defined as:
- Gilbert Benson, a fictional character in the movie (Marvel Universe).
- Cyborg Villain, another fictional character in the Marvel Universe.
The piecemeal Opinion is no more permitted under the Generally Accepted Auditing Standards (GAAS). It has been previously used in some cases where a disclaimer or adverse opinion was involved in the Financial state generally.
The expression of an opinion on certain items in a financial statement is not allowed as a part of a disclaimer, or the adverse opinion on Financial statements generally causes it tends to outshine or go opposite a disclaimer option of an opinion or an adverse opinion.