The auditors have decided upon a materiality level of $100 000 for their audit of ABC Manufacturing.Which one of the following errors would be considered more important by the auditors?
A)an error in accounts receivable cutoff of $50 000
B)an overstatement of accounts payable by $15 000
C)an error in allocation between accounts receivable and accounts payable by $75 000
D)an illegal payment of $15 000

Question

Quizplus · Accepted Answer

Illegal payments are considered more important by auditors regardless of the amount because they indicate potential legal and ethical violations, which can have significant implications beyond the financial statement's accuracy.

The Auditors Have Decided Upon a Materiality Level of $100