As management is responsible for the financial statements, failure to assess the risk of material misstatement is not detrimental to the auditor.

Question

Quizplus · Accepted Answer

The statement is incorrect. It is the auditor's responsibility to assess the risk of material misstatement in the financial statements, and failure to do so can be detrimental to the auditor's reputation, liability, and credibility. Management is responsible for preparing the financial statements, but the auditor is responsible for ensuring their accuracy and reliability.

As Management Is Responsible for the Financial Statements, Failure to Assess