Qualitative Factors in Evaluating Uncorrected Misstatements: Debt Covenant Impact

When you evaluate the uncorrected misstatements in relation to the specific financial statement captions and disclosures involved and to the financial statements as a whole, you take into account relevant quantitative and qualitative factors.

Which one of the following is an example of a qualitative factor?

A. Comparing the effect of the uncorrected misstatements, individually or in combination with others, on the specific financial statement captions and disclosures involved. B. Comparing the amount of the uncorrected misstatements, individually or in combination with others, with the final materiality level. C. Comparing the amount of the uncorrected misstatements, individually or in combination with others, with the financial statements as a whole. D. Comparing the effect of the uncorrected misstatements, individually or in combination, on debt covenant calculations.

D. Comparing the effect of the uncorrected misstatements, individually or in combination, on debt covenant calculations.