The starting point in making the final assessment of materiality and audit risk is to total the misstatements found in examining all accounts that were corrected by the client.

Question

Quizplus · Accepted Answer

The starting point in making the final assessment of materiality and audit risk involves considering the auditor's understanding of the entity and its environment, including its internal control, and not just the total of corrected misstatements. Misstatements, both corrected and uncorrected, are considered, but they are part of a broader assessment that includes qualitative and quantitative factors.

The Starting Point in Making the Final Assessment of Materiality