Important to note on an audit that the purpose of an audit ...

Important to note on an audit that the purpose of an audit is to report on the financial statements and not to provide assurance on internal control.

In an overall review stage of an audit, it is important to consider whether the results of audit procedures affect the risk of material misstatement due to fraud.

At the start of an audit, preliminary judgement on materiality is made. Most often that not, this is done by using an entity's financial statements from the prior year. 

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