CHARTERED ACCOUNTANT'S FIRMS RANKING IN PAKISTAN

1-A.F. Ferguson & Co. (PwC)

2-KPMG Taseer Hadi & Co (KPMG)
3-Ernst & Young Ford Rhodes Sidat Hyder & Co (EY)
4-Anjum Asim Shahid Rahman (Grant Thoronton)
5-M. Yousuf Adil Saleem & Co (Deloitte)
6-Riaz Ahmad & Company (Nexia Intl)
7-Horwath Hussain Chaudhury & Co (Crowe Horwath)
8-Avais Hyder Liaquat Nauman
9-BDO Ebrahim & Co (BDO)
10-Hameed Chaudhry & Co
11-Hyder Bhimji & Co
12-Ilyas Saeed & Co (MGI)
13-Rahman Sarfaraz Rahim Iqbal Rafiq
14-Muniff Ziauddin Junaidy & Co (BKR Intl)
15--Naveed Zafar Husain Jaffery & Co
16-Nasir Javeed Maqsod Imran & Co
17-Nazeer Chaudhry & Co
18-HLB Ijaz Tabassum & Co (HLB)
19-Uzair Hammad Faisal & Co
20-Tariq Abdul Ghani & Co

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AUDITOR'S REPORT:
The auditors report begins with a brief introduction about the audit engagement. Thereafter, the
auditors report is divided in to three major sections. In the first section, the auditor explains that
preparing the financial statements and maintaining sound internal controls is managements
responsibility. In the second section, the auditor explains its own responsibilities, duties and
rights regarding the engagement. Here, the auditor emphasizes the nature of the audit and states
that the auditor only examines internal controls and accounting records on a sample basis. In the
third section, the auditor gives his opinion on the financial statements.
Categories of auditor's opinions
1. Unqualified Opinion
2. Qualified Opinion
3. Adverse Opinion
4. Disclaimer From Opinion

1. Unqualified Opinion
From the point of view of the audited company or organization, the unqualified opinion is the
best possible audit outcome, and it is by far the most frequently reported opinion (the other
opinions below are rarely reported, at least for audits on financial reports from publicly listed
companies). When presented by a third party (external) auditor, the report assures the public that
the auditor has examined the financial reports and is of the opinion that the financial information
is presented fairly and in conformance with Generally Accepted Accounting Principles (GAAP).

2. Qualified opinion
A qualified opinion means the auditor found the financial reports essentially in conformance with
Generally Accepted Accounting Principles, except for one or a few areas where the auditor
cannot, or does not want to, assert conformance. The qualification may come about because

The company misstated or misclassified an accounting entry (e.g., an expense item that should
have appeared above the Income Statement gross profit line is inappropriately listed below gross
profit, resulting in misleading gross profit and gross margin figures).
There were limitations on the scope of audit coverage if, for instance, the auditor was unable for
some reason to check certain sections or areas of the reports.
There is remaining uncertainty about fairness or conformance with GAAP. Here, the auditor may
not feel there is justification for an Adverse option, but at the same time, is not comfortable
endorsing an unqualified option.
When an auditor issues a qualified opinion, the specific reasons for the qualification will be
stated.

3. Adverse opinion.
An adverse opinion means the auditor has concluded that the audited financial statements do not
fairly represent the organization's financial position or financial performance, and that there are
significant departures from GAAP. In most cases, before publishing an adverse opinion, the
auditor advises the organization's accountants and officers of the problems and works with them
to correct the financial reporting situation, so that an opinion can be published that is either
unqualified or qualified (1 and 2 above), rather than adverse.
When an auditor issues an adverse opinion, the report will specifically state the reasons for the
opinion (specific misstatements or other departures from GAAP). An adverse opinion will almost
certainly result in rejection of the organization's financial reports by the investment community,
lending institutions, regulatory bodies, and governments.

4. Disclaimer of opinion
The auditor may issue a disclaimer of opinion, that is, publicly report that the auditor has chosen
not to issue an opinion. This may occur when Auditors decide they cannot be impartial or
independent regarding the company or organization audited.The auditor's scope of coverage was
substantially limited.The auditor has significant uncertainties regarding the appropriateness of
parts or all of the financial reports.

Difference Between Qualified And Unqualified Report

Unqualified Report
In an unqualified report, the auditors conclude that the financial statements of your business
present fairly its affairs in all material aspects. The opinion embodies the assumptions that your
business observed compliance with generally accepted accounting principles and statutory
requirements. Also known as a clean report, such a report implies that any changes in the
accounting policies, their application and effects, are adequately determined and divulged. This
opinion does not tell that your business is in good economic health. It merely states that your
financial report is transparent and thorough and has not hidden important facts.
Qualified Report
A qualified report is one in which the auditor concludes that most matters have been dealt with
adequately, except for a few issues. An auditors report is qualified when there is either a
limitation of scope in the auditors work, or when there is a disagreement with management
regarding application, acceptability or adequacy of accounting policies. For auditors an issue
must be material or financially worth consideration to qualify a report. The issue should not be
pervasive, that is, the issue should not misrepresent the factual financial position. If issues are
material and pervasive, the auditor issues a disclaimer or adverse opinion. A qualified audit
report does not mean that your business is suffering, and it doesn't mean that your financial
statement isn't transparent. It merely reflects the auditors inability to give a clean report.

Other Difference
Another difference lies in the wording of the opinion paragraph of an auditors report. When
issuing an unqualified report the auditor might write, In our opinion, the financial statements
give a true and fair view of the financial position of XYZ Enterprises as of Conversely, the
opinion paragraph in a qualified report might begin with, In our opinion, except for the effects
of the following adjustments, if any, as might have been determined to be necessary had we been
able to perform tests on companies stocks, the financial statements give a true and fair view of
the financial position of XYZ Enterprises as Notice that there are exceptions in the
opinion paragraph of the qualified report.
Impact of Opinion
As a businessperson, you should keep in mind that there are deep-held perceptions about
auditors' opinions. Banks, investors and regulators such as the IRS rely on audited financial

statements for their analytical needs. Stakeholders such as banks and investors view qualified
audit report unfavorably. Therefore, you should hope to receive an unqualified audit report
because it gives a positive impression of your business. For example, if your business was issued
a qualified audit report on inventory matters, your bank is more likely to demand further details
about your inventory before issuing credit to you.