Z Lo 11-4 11.59 Uncorrected Misstatements and Performance Materiality. During the conduct of an audit, auditors may identify misstatements as a result of the completion of their substantive procedures. An important activity performed inthe completion stages of the audit is considering the materiality of misstatements identified during the audit.Required: a. What is an wncorrected misstaterment? What is the auditors' responsithe completion stage of the audit engagement? ity for uncorrected misstatements during b. How do auditors use the roflover method and iron curtain method to evaluate uncorrected misstatements? Page 517 . Assume that auditors have identified misstatements during the current audit that had a net impact of $100.000 on expenses and payables (both were understated). If the cumulative effect of prioruncorrected misstatements was $120,000 (overstatement of net income and understatement ofliabilities) and materiality was $150,000, what would the auditors' conclusion be with respect to themisstatements under the rollover method and iron curtain method? . Based on your response to part (¢), what adjustments (if any) would the auditors propose to the client's financial statements? . What requirements do auditors have for communicating uncorrected misstatements identified during the audit engagement