Definition
The auditing equivalent of a failing grade, where auditors formally declare that financial statements are materially misstated and unreliable. It's the corporate kiss of death that sends investors running for the exits.
Example Usage
After the auditor issued an adverse opinion, the company's stock became essentially untradeable and banks called their loans.
Origin
Standard audit reporting framework established by accounting standards bodies
Fun Fact
Adverse opinions are so rare that many veteran auditors have never issued one, since companies usually withdraw statements and fix problems before that point.
Source: Auditing standards and professional accounting terminology
Related Terms
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See “adverse opinion” in Corporate Speak, Gen-Z Slang, Pirate Speak, and more.
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