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:

Equity Theory

A theory of motivation suggesting that individuals assess their job satisfaction and motivation based on the perceived fairness of their treatment compared to others.

Extended Lunch Breaks

Longer than normal break periods allocated for lunch, beyond the typical schedule.

Co-Workers

Individuals who work together, often sharing tasks or goals within the same organization.

Economies Of Scale

The cost advantages that enterprises obtain due to their scale of operation, leading to decreased costs per unit.