When to Issue an Opinion on Supplementary Information

Sometimes the question arises as to when you should issue an opinion on supplementary information.

The auditor should opine on some supplementary information, but not all.

Opinion Given on Supplementary Information

We know that when supplementary information is derived from or relates directly to, the underlying accounting and other records used to prepare the financial statements, the auditor will usually issue an opinion on the supplementary information. That opinion paragraph ends with wording such as:

In our opinion, the information is fairly stated in all material respects in relation to the financial statements as a whole.

Opinion Not Given on Supplementary Information

But what if the information is not derived from or does not relate directly to underlying accounting records used to prepare the financial statements (sometimes referred to as “Other Information”)? Examples include:

  • Financial summaries or highlights
  • Employment data
  • Planned capital expenses
  • Financial ratios
  • Names of officers

AU-C Section 720—Other Information in Documents Containing Audited Financial Statements (paragraph .01)–formerly SAS 118–states:

In the absence of any separate requirement in the particular circumstances of the engagement, the auditor’s opinion on the financial statements does not cover other information, and the auditor has no responsibility for determining  whether such information  is properly stated.

The auditor can disclaim an opinion on the “other information” using the following language (AU-C 720, paragraph .A13):

Our audit was conducted for the purpose of forming an opinion on the basic financial statements as a whole. The [identify the other information] is presented for purposes of additional analysis and is not a required part of the basic financial statements. Such information has not been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, we do not express an opinion or provide any assurance on it.

With that said, remember, opinions can (sometimes) be rendered on non-accounting data. See my related post.

Can Nonaccounting Information be Included in Supplementary Information?

Can nonaccounting information (e.g., number of units produced related to royalties) be included in supplementary information?


AU-C Section 725—Supplementary Information in Relation to the Financial Statements as a Whole (paragraph .A6) says:

Management may include nonaccounting  information and accounting information that is not directly related to the basic financial statements in a document containing the basic financial statements. Ordinarily, such information would not have been subjected to the auditing procedures applied in the audit of the basic financial statements, and accordingly, the auditor would be unable to opine on the information in relation to the financial statements as a whole. In some circumstances, however, such information may have been obtained or derived from accounting records that have been tested by the auditor (for example, number of units produced related to royalties under a license agreement or number of employees related to a given payroll period). Accordingly, the auditor may be in a position to express an opinion on such information in relation to the financial statements as a whole.


The Minimalist Auditor

Do you like to travel light? Here's some ideas to lessen your load.

Are you a minimalist auditor?

I remember when I would load my audit files on a hand-truck (I’m not kidding), especially for local government audits. I felt like I worked for a moving company rather than a CPA firm.

My back is thankful for paperless software.

In the present age of minimalism, everything is smaller, even the audit gear we use. Scanners, monitors, cell phones, tablets, projectors–all are more compact. For the traveling auditor, this is like manna from heaven.

Let me suggest a few hardware and software ideas to lighten your load.

minimalist auditor

Courtesy of iStockphoto


Fujitsu ScanSnap S1300i Instant PDF Sheet-Fed Mobile Document Scanner

The weight is 4.9 pounds and the cost is $249.99. It has a ten-page document feeder.

If you want a lighter scanner with fewer features, try the ScanSnap S1100, weighing only 12.3 ounces. The cost is $169.99.

Fujitsu ScanSnap S1100 CLR 600DPI USB Mobile Scanner (PA03610-B005)

Can’t spare the traveling space for a scanner? Or maybe you’d rather not spend the money? Buy the cell phone scanning app: Scanbot. The cost is $1.99. Scanbot is available on iPhones and Android phones. The app can scan multiple pages and will–once you tweak the settings–automatically feed output to a cloud product such as Evernote. Alternatively, you can email the scans.


I use a Dell laptop that has a ten-key pad built into the keyboard, so I don’t need a separate adding machine. I use Judy’s TenKey software; the cost is $19.95.

Cell Phone

Apple iPhone 6s

I use an iPhone 6S and love the feel and intelligence of this device. The battery life is substantial and the weight is 6 ounces. It fits in my pant’s pocket.


Most cell phone companies offer Internet hotspots. Since you probably already own a cell phone, there is no need for an additional physical device for an Internet connection. Check with your cell phone company about activating the hotspot. The cost will be about $30 per month.


Apple iPad mini MD529LL/A (32GB, Wi-Fi, Black)

I am an Apple fan, so you know I will recommend the iPad mini which can be purchased for as little as $279 (16GB model) on Amazon. The weight is less than 1 pound.


AAXA P4 P4X Pico Projector, 95 Lumens, Pocket Size, Li-Ion Battery, HDMI, Media Player, 15,000 Hour LED, DLP Projector

The Pico Projector is pocket sized and, at $240, provides you with 125 lumens. The dimensions are 5.6 x 2.7 x 1.2 inches and it weighs 12.8 ounces.

Your Ideas?

How do you lighten your traveling load? Please share your ideas.