Qualitative factors can affect an auditor's assessment of materiality. Which of the following statements is true?
| I. | Misstatements that are otherwise immaterial may be material if they affect earnings trends. |
| II. | Misstatements that are otherwise minor may be material if there are possible consequences arising from contractual obligations.
▸ I only
▸ II only
▸ both I and II
▸ neither I nor II
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