The summary of misstatements schedule is used to record and summarize ___________.
A)all non-trivial misstatements only
B)any and all misstatements identified during the course of the audit
C)all non-trivial misstatements identified and projected likely misstatements
D)all material misstatements and projected likely misstatements

Question

Quizplus · Accepted Answer

The summary of misstatements schedule is used to record and summarize all non-trivial misstatements identified and projected likely misstatements, as these misstatements have the potential to impact the overall financial statements. Materiality is a threshold used in determining the significance of misstatements, so only recording material misstatements may not capture all potential impacts on the financial statements. Additionally, recording all misstatements, including trivial ones, may be time-consuming and not necessary for the purposes of the audit. Therefore, option C is the best choice.

The Summary of Misstatements Schedule Is Used to Record and Summarize