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Kim Smith.
Kim Smith.-
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wyyy
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Hi,
How much is defined as pervasive?
I found in somewhere stated that:If the % of misstated item is 60% or more of total asset/revenue/profit, then it is pervasive
It is pervasive if aggregate misstatement is 60% or more
It is pervasive if a misstatement converts the profit to loss
It is pervasive if management unable to obtain management representation letter
Are these matters correct to define as pervasive?
Thank you.
Kim Smith
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If you use search function on the key words of your query you’ll find very similar Qs answered, for example:
https://opentuition.com/topic/adverse-opinions/
Pervasive is not a “degree” of material. Re your management rep example – it would depend what management rep you are referring to. If it’s the required rep concerning mgt’s responsibilities for the financial statements clearly this lack of evidence is pervasive hence disclaimer of opinion. (And why this situation is very very rare in the real world.)
wyyy
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