When analyzing misstatements, the auditor will determine
A) the implications of the misstatements on other audit areas.
B) the potential impact on the financial statements.
C) the effect on company operations.
D) all of the above.

Question

Quizplus · Accepted Answer

When analyzing misstatements, the auditor will need to consider all of the above factors. The implications of the misstatements can affect other audit areas, such as internal controls and materiality thresholds. The potential impact on the financial statements can be material and require further investigation. Finally, the effect on company operations may be relevant to understanding the root causes of the misstatements and their potential recurrence. Therefore, all options are important considerations when analyzing misstatements.

When Analyzing Misstatements, the Auditor Will Determine