GAAP require that changes in accounting principles or their method of application be to a preferable principle and that the nature and impact of the change be adequately disclosed.
When a material change occurs, the auditor should add an explanatory paragraph after the opinion paragraph that discusses the nature of the change and points the reader to the footnote that discusses the change.
The materiality of a change is evaluated based on the current year effect of the change. An explanatory paragraph is required for both voluntary changes and required changes due to a new accounting pronouncement.