Concept explainers
Introduction:When an error is occurred in transaction area or account section that error is called misstatement.
Requirement 1
Define the misstatement.
Introduction:The factual misstatement is that type of error which is recognized by the auditor. There is no doubt in this.
Requirement 2
Define the factual misstatement.
Introduction:When the misstatement is depending on the total samples chosen by the auditor that type of misstatement is called projected misstatement.
Requirement 3
Define the projected misstatement.
Introduction:When the limit of the misstatement is decided by the auditor to control the errors that type of misstatement is tolerable misstatement.
Requirement 4
Define the tolerable misstatement.
Introduction:The expected misstatement is decided by the auditor to compare from the previous results and projected on the total population.
Requirement 5
Define the expected misstatement.
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Chapter 8 Solutions
MindTap Accounting, 1 term (6 months) Printed Access Card for Johnstone/Gramling/Rittenberg's Auditing: A Risk Based-Approach, 11th
- Distinguish between counterbalancing and non-counterbalancing errors. Give an example of each.arrow_forwardstate the effect on planned evidence (increase or decrease) of changing each of 'AN INCREASE IN TOLERABLE MISSTATEMENT, while the other factors remain unchanged.arrow_forwardDefine the following terms: (a) performance materiality, (b) tolerable misstatement, (c) clearly trivial.arrow_forward
- Which of the following would not result in exposure to nonsampling risk?a. Measuring the characteristic of interest in an inappropriate manner.b. Selecting items that are not representative of the population of interest.c. Making an unintentional mistake in measuring the characteristic of interest.d. All of the above would result in exposure to nonsampling risk.arrow_forwardDescribe a “loss carryforward.” Discuss the uncertainty when it arises.arrow_forward
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