If an Auditor Establishes a Relatively High Level for Materiality

question 41

Multiple Choice

If an auditor establishes a relatively high level for materiality, then the auditor will

• A) accumulate more evidence than if a lower level had been set.
• B) accumulate less evidence than if a lower level had been set.
• C) accumulate approximately the same evidence as would be the case were materiality lower.
• D) accumulate an undetermined amount of evidence.

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Definitions:

Direct Competitors

Businesses or entities that offer the same or very similar goods or services to the same customer or target market.

Catalog Retailer

A business that sells products through catalogs mailed to customers, who can place orders by mail, telephone, or online.

Competitive Advantage

An attribute or situation which positions a company more favorably or at an advantage relative to its competitors in the industry.

Distinctive Competency

A unique capability or skill that gives an organization a competitive advantage over its peers.