Which of the Following Statements About Materiality Is Incorrect

question 45

Multiple Choice

Which of the following statements about materiality is incorrect?

• A) The preliminary assessment of materiality guides audit planning and testing.
• B) Materiality is used to guide the validity of information contained in the financial statements.
• C) Materiality is a key auditing concept that is assessed during the planning stage of every audit.
• D) Information is considered material if it has no impact on the decision-making process of financial statement users.

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Definitions:

Required Duties

Obligations or tasks that an individual or entity must perform as mandated by law or contract.

Any Breach

Refers to the violation or infringement of any terms or conditions set out in a contract or agreement.

Discharges

Refers to the legal process by which a debtor is released from liability for certain debts, effectively wiping them out.

Promises of Performance

Commitments made by one party to carry out specific actions or tasks, usually within the context of a contract.