Which of the Following Would Not Be a Reason to Lower

question 89

Multiple Choice

Which of the following would not be a reason to lower the threshold for materiality?

• A) The auditor is concerned with potential violations of debt covenants.
• B) There were proposed adjusting entries to a particular account in prior years.
• C) The consequences of a potential misstatement in an account balance are very high.
• D) The audit team wants to limit the amount of time spent at the client's facilities.

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Definitions:

Alderfer's ERG Theory

A motivation theory that categorizes human needs into three groups: Existence, Relatedness, and Growth, suggesting that individuals are motivated by the fulfillment of these needs in varying degrees.

Distributive Justice

Concerns the fair allocation of resources and benefits among members of a society or group.

Fairly Allocated

The perception or condition of resources, duties, or rewards being distributed in a just and equitable manner among all parties.

Procedural Justice

The fairness and transparency of the processes that lead to outcomes or decisions.