If an undisclosed related-party transaction was identified during the completion of audit testing, the implication on the audit could be material misstatement. According to our reading, there are other reasons for material misstatements, these includes data processing errors or data accumulation errors in computing the balances of the accounts that underlie the numbers reported on the financial statements, failure to properly classify an account and report it where it should be included in the financial statements, missing items that should have been included, disclosure note about an issue that is material in nature that should have been included in the financial statements was missing, and errors in judgement when forming an estimate that is the basis of an accounting issue