Which of the Following Is Not a Qualitative Factor That

question 12

Multiple Choice

Which of the following is not a qualitative factor that may affect an auditor's establishment of materiality?

• A) Potential for fraud.
• B) The entity is close to violating loan covenants.
• C) Firm policy sets materiality at five per cent of pre-tax income.
• D) A small misstatement would interrupt an earnings trend.

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Definitions:

Manuscript Illumination

The art of decorating the text and pages of manuscript books with gold, silver, and vivid colors, prevalent in the Middle Ages.

Etching

A printmaking process that uses strong acid or mordant to cut into unprotected parts of a metal surface to create a design in intaglio in the metal.

Woodcut

A relief printing technique in printmaking where an image is carved into the surface of a block of wood, with the printing parts remaining level with the surface while the non-printing parts are removed.

Italian Illusionism

A style of painting and decorating that tricks the eye into perceiving painted detail as three-dimensional objects or scenes, often used in frescoes during the Renaissance.