A deficiency that implies that there is a reasonable possibility of misstatement in the financial statements that is significant but not material is:
A)a material weakness.
B)a significant deficiency.
C)an insignificant deficiency.
D)a probable deficiency.

Question

Quizplus · Accepted Answer

A significant deficiency is a deficiency in internal control over financial reporting that is less severe than a material weakness, yet important enough to merit attention by those responsible for oversight of the company's financial reporting. It implies that there is a reasonable possibility that a misstatement could occur in the financial statements that is significant but not material.

A Deficiency That Implies That There Is a Reasonable Possibility