---
title: What is an Auditor's Opinion?
description: Montana local governments aim for an “unqualified” or clean audit opinion, indicating financial statements are fairly presented. Modified opinions—qualified, adverse, or disclaimed—signal issues that require correction. Audits help ensure transparency, though they rarely detect fraud directly.
---

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March 18, 2026

# What is an Auditor's Opinion?

## Audit Opinions: Understanding Financial Statement Evaluations in Montana Local Government

The audit culminates in an auditor’s opinion on the government’s financial statements. The auditor’s opinion is generally no more than a sentence or two long and is embodied in a letter to the government officials entitled Independent Auditor’s Report. All governments seek to obtain an “Unqualified Opinion” also referred to as a clean opinion. A clean opinion means that the government’s financial statements are fairly stated in all material respects in relation to the financial statements taken as a whole. It basically means that the auditors did not find any errors that were so significant and their effect so great, as to cause the government’s financial  
statements to be misleading.

Most governments are able to receive an unmodified opinion. There are times, however, when a government may receive a modified opinion. This may be due to an accounting requirement that the government failed to implement. Or, it could be that the government’s financial records are inaccurate or misleading. In these instances, the auditors may issue a modified opinion. Their choices consist of: an adverse opinion (do not present fairly), a disclaimer of opinion (decline to give an opinion), or a qualified opinion (fairly presented, except for). Which of these opinions an auditor may issue revolves around the auditor’s judgment and is dependent upon facts and circumstances. If a governmental entity receives anything other than an unmodified (clean) opinion, immediate steps should be taken to correct the problem.

 

Montana Municipal Officials Handbooks 3rd Edition, Section 5.503

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Resources prepared by the MSU Extension Local Government Center are intended for educational purposes only and do not constitute legal advice. For interpretation or application of the law, please consult qualified legal counsel. The Montana State University Extension Service is an ADA/EO/AA/Veteran’s Preference Employer and Provider of Educational Outreach.

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