Qualified opinion
In one sentenceAn opinion in which the auditor says the statements are fairly presented “except for” a specific matter that is material but not pervasive across the statements as a whole.
Simply put
A qualified opinion means the statements are sound overall, but one or more items contain a material misstatement, or the auditor could not obtain sufficient evidence about them.
The report explains the reason for the qualification in a separate paragraph, so read it to understand how big the problem is.
Example
The auditor could not attend a store's inventory count at year end and found no alternative way to verify it. Inventory is important but is not the whole of the statements, so the auditor gave a qualified opinion regarding inventory.
Don't confuse it with
Adverse opinionA qualified opinion is for a contained problem, while an adverse opinion is for material, pervasive misstatements that make the statements as a whole not fairly presented.