Risk of Material Misstatement
Risk of material
misstatement in audit means that financial statement may not present the
financial affair fairly and there may be some misstatement due to fraud or
error.
Types
of Material Misstatement Risks
There
are two types of material misstatement risks i.e. financial statement level
risk and assertion level risk. Financial statement level risk effect the
financial statement as whole where the assertion level risk is associated to
specific item of financial statements.
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