During the current year, an entity changes their method for accounting for inventory from average cost to FIFO, which the entity and the auditor believe better represent the flow of inventory through the entity and represent a more appropriate inventory valuation.$$ Accordingly, the auditor believes the change is justified.$$ The auditor has audited inventory based on the change and discovered no material misstatements.$$ The entity has elected to restate prior years inventory based on average cost.$$ No disclosures were included as both methods represent appropriate inventory valuation methods under generally accepted accounting principles.$$ How should the auditor treat this change in their report?$$

Group of answer choices

The auditor should modify the opinion due to a GAAP departure.

The auditor may issue an unqualified opinion with no modification as inventory for both years is believed to be materially correct.

The auditor should issue an unqualified opinion with an explanatory paragraph describing the change.

The auditor should modify the opinion as the financial statements for the two years are no longer consistent.