Most Audit Firms Use a Schedule,often Referred to as a Summary

question 84

Multiple Choice

Most audit firms use a schedule,often referred to as a summary of unadjusted audit differences (SUAD) ,to accumulate the known and projected misstatements and the carryover effects of prior-year uncorrected misstatements.Which of the following statements regarding this process is false?

• A)Individually immaterial misstatements are not entered on the SUAD.
• B)Possible adjustments to the financial statements that are left uncorrected are referred to as waived.
• C)Tax effects are shown on the SUAD.
• D)The nature of the misstatement,as well as the quantitative amount,is considered in the judgment of materiality.

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Definitions:

Future Cost

Costs that have not yet been incurred but are expected to be as a result of current decisions or plans.

Information

Data that has been processed, organized, or presented in a manner that makes it meaningful or useful to the person receiving it.

Accounting Data

Information related to financial transactions and status, used for analysis, planning, and decision-making in business.

Qualitative Terms

These are descriptive, non-numerical characteristics or attributes used to assess aspects of operations, strategies, or market conditions.