Share 1. When considering the allowability of a direct financial interest in a client materiality is not important True False QUESTION 10 Management is responsible for adjusting the financial statements to correct all misstatements found by the auditor. True False QUESTION 11 Vouching is useful when testing ement, while tracing is useful when testing for overstatement. True False QUESTION 12 In order to perform an audit, an auditor is required to have independence in fact and independence and appearance. True False QUESTION 13 In order to assess the risk of material misstatement of the financial statements whether due to error or fraud, the auditor needs to obtain a sufficient understanding of the entity, the client's environment, and the client's internal control True False