Materiality arises when a misstatement in the financial statements could affect a decision of a reasonable user of the statements. Explain the levels of materiality used for determining the type of opinion.

Materiality arises when a misstatement in the financial statements could affect a decision of a reasonable user of the statements. Explain the levels of materiality used for determining the type of opinion.

Auditing: A Risk Based-Approach to Conducting a Quality Audit

10th Edition

ISBN:9781305080577

Author:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Publisher:Karla M Johnstone, Audrey A. Gramling, Larry E. Rittenberg

Chapter15: Audit Reports On Financial Statements

Section: Chapter Questions

Problem 8TFQ

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Materiality arises when a misstatement in the financial statements could affect a decision of a
reasonable user of the statements.
Explain the levels of materiality used for determining the type of opinion.

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Similar questions

Something is deemed to be 'material' if its omission, non-disclosure or misstatement is likely to affect economic decisions or other evaluations made by users entitled to rely on the financial statements. Select one alternative: True False
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When an event impacts a financial statement element, it should be recognized in the accounting records even if reliability of the amount is questionable. True False
discuss the type of opinion is issued by the auditorr if he or she is unable to determine the overall fairness of the financial statements?
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When financial statements are affected by a material departure from generally accepted accounting principles, the auditors should: Withdraw from the engagement. Issue an unmodified opinion with a basis for modification paragraph. Issue an "except for" qualification or a disclaimer of opinion. Issue an "except for" qualification or an adverse opinion.
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when the auditor discover a misstatement in the financial statement and this misstatement is considered as material and will affect the overall financial statement fairness , the auditor will issue a : Select one: a. Qualified opinion b. Modified wording opinion c. unqualified with emphasis of matter d. Adverse opinion