As auditors expect certain accounts to have more misstatements than others, both overstatements and understatements must be considered. Explain the reasons for permitting the sum of the tolerable misstatement to exceed overall materiality.

Auditing: A Risk Based-Approach (MindTap Course List)
11th Edition
ISBN:9781337619455
Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg
Chapter3: Internal Control Over Financial Reporting: Responsibilities Of Management And The External Auditor
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As auditors expect certain accounts to have more misstatements than others, both overstatements and understatements must be considered. Explain the reasons for permitting the sum of the tolerable misstatement to exceed overall materiality.
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