Audit Standards Require the Auditor to Consider Materiality Early in the Audit

Audit standards require the auditor to consider materiality early in the audit. Which statement(s) regarding preliminary materiality are true?
I. Preliminary materiality may change during the engagement.
II. Preliminary materiality is the maximum amount the auditor by which the auditor believes the financials could be misstated and still not affect the decisions of reasonable users.

A) I only
B) II only
C) both I and II
D) neither are true

Correct Answer:

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