Question
Aristotle & Co is the group auditor of the Plato Group. At the planning stage of the audit, group materiality is determined at $250,000. Plato
Aristotle & Co is the group auditor of the Plato Group. At the planning stage of the audit, group materiality is determined at $250,000.
Plato Co is the parent company of the group, and has a subsidiary called Socrates Co. The group auditor considers Socrates to be a significant component for the purposes of the group audit. Socrates Co is audited by a component auditor.
The component auditor's report on Socrates Co is qualified as a result of a material misstatement. The amount of the misstatement is $120,000.
Required
What is the effect on the audit report given on the Plato Group?
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Analysing Financial Statements For Non-Specialists
Authors: Jim OHare
2nd Edition
1138641529, 9781138641525
