Financial statement: A formal record of business transactions that record, analyze, and summarize the performance of a company for a specific or defined period is termed financial statement.
Audit report: A standard format which contains the written opinion with relevant documentation of financial records of a company or entity or organization is termed audit report. This is prepared by an Auditor based on the financial records submitted by the organization.
Material and nonmaterial: Any change which affects the net revenue of the company less than 5% is termed nonmaterial change and more than 5% is termed material change.
To determine whether to classify the statement as material.
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