Misstatements in the acquisition and expenditures process may be
A)overstatement misstatements
B)understatement misstatements
C)both overstatement and understatement misstatements
D)neither overstatement nor understatement misstatements

Question

Quizplus · Accepted Answer

Misstatements in the acquisition and expenditures process may be both overstatement and understatement misstatements. Overstatements occur when the financial statements show amounts that are higher than the actual amounts, while understatement misstatements occur when the financial statements show amounts that are lower than the actual amounts. Both types of misstatements can occur in the acquisition and expenditures process, depending on the nature of the transaction and the control weaknesses present in the process.

Misstatements in the Acquisition and Expenditures Process May Be