"answered in the negative or with the qualification"what is that?

while reading section 143....
I come across subsection 3.....
well it is clear....huh... understandable....
then I read subsection 4.....
"where matters required to be included under this subsection is answered in the negative or with the qualification...,the report shall state the reasons therefore."
#let me clarify it.
#is the law trying to say the following sceanrio?:-
story: auditor is asking for info. u/ss 3 from the MGT....
MGT answered negatively(I.e question is not applicable for us)...
is it correct????