term used when an auditor reports that the company's financial statements do not present fairly the financial position, results of operations, or changes in financial position or are not in conformity with gaap. The auditor must provide the reasons for the adverse opinion in the audit report. An adverse opinion is rare and usually results when the CPA has been unable to convince the client to amend the financial statements so that they reflect the auditor's estimate about the outcome of future events or so that they otherwise adhere to GAAP.
accountant's opinion concerning financial statements, that the statements are not in conformity with Generally Accepted Accounting Principles (GAAP) and/or that they do not present results fairly.
opinion expressed by a company's independent auditors that the firm's financial statements do not accurately reflect the company's current financial position or operating results. An adverse opinion is a far more serious finding than a qualified opinion, in which only some issues are of concern to the auditor. Investors should be extremely cautious about investing in any company with an adverse opinion from its auditors.
