Which Statement Is True Concerning Materiality

question 45

Multiple Choice

Which statement is true concerning materiality?

• A)Misstatements are material if they could reasonably be expected to influence the decisions of users of the financial statements.
• B)Materiality guidelines are specifically prescribed by the PCAOB.
• C)Materiality is not a useful concept in assessing internal control effectiveness.
• D)Materiality is a concept applied to financial statement presentation but not to disclosures.

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Definitions:

Johari Window

A model that helps understand and improve self-awareness, interpersonal relationships, and communication by dividing personal awareness into four quadrants.

Competence

The ability and skill to perform a task effectively and efficiently, reflecting a person's suitability for a particular role or job.

Consistency

The quality of achieving a level of performance or behavior that does not significantly vary over time.

Johari Window

A model that is used to understand and improve self-awareness, interpersonal relationships, and communication by mapping known and unknown aspects of oneself and by others.