Upon discovering information that indicates a material misstatement due to fraud, the auditor must assume that the misstatement is an isolated incident.

Question

Quizplus · Accepted Answer

The auditor cannot assume that the misstatement is an isolated incident. They must perform additional procedures to determine if the misstatement is pervasive and affects other financial statement assertions. Additionally, the auditor must consider the possibility of additional fraud or misstatements.

Upon Discovering Information That Indicates a Material Misstatement Due to Fraud