CAF-8 · Chapter 1 · Question 5 of 10
An auditor identifies a misstatement in the financial statements of Horizon Ltd. The auditor must determine if it is material. Information is considered material if:
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: B) Its omission or misstatement could reasonably influence the economic decisions of users taken on the basis of the financial statements.
Explanation
Materiality is judged by whether an omission or misstatement would influence the economic decisions of the intended users relying on the financial statements.
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