Question

A material weakness involves a reasonable possibility that what size misstatement will not be prevented or detected?

- Immaterial.
- Material.
- More than inconsequential.
- Substantial.

Answer 1

- Material

Step-by-step explanation:

A material weakness arises when the internal control systems of a company which are designed to prevent or detect significant financial misstatements are ineffective. As a result, there is a likelihood that the material weakness could result into material misstatements in the company's financial statements.