The definition of materiality indicates that both the users and the auditors of financial statements are
assumed to have knowledge of the likely preparers of the statements.

Question

Quizplus · Accepted Answer

The definition of materiality does not assume that users or auditors have knowledge of the likely preparers of financial statements. Materiality refers to the magnitude of an error or omission in the financial statements that would influence the decision of a reasonable user.

The Definition of Materiality Indicates That Both the Users and the Auditors