Abstract This paper reports the perceptions of bank loan officers regarding the new standard unqualified audit report and the new formats used for two qualified opinions. The results suggest that the Auditing Standards Board successfully refined the ability of the audit report to communicate between independent accountants and the users of financial statements. Bank loan officers who read new audit reports are better able to identify the responsibilities assumed for the financial statements by both management and the independent auditor than can loan officers who read old audit reports. In addition, loan officers from larger banks appear to view scope limitations with greater disfavor than loan officers affiliated with smaller banks.
Miller et al. (Mon,) studied this question.