Final answer:
True, unadjusted financial misstatements exceeding a material amount can lead to an audit report modification, such as a qualified, adverse opinion or a disclaimer.
Step-by-step explanation:
True, when the total likely misstatement in the financial statements exceeds a material amount, it is likely to lead to an audit report modification. Materiality is a fundamental concept in auditing that pertains to the significance of an error or omission in the financial statements. If an auditor concludes that the financial statements contain misstatements that are material, and these are not adjusted by management, the auditor is required to modify their audit opinion to communicate the potential impact of these misstatements to users of the financial statements.
This process is guided by professional standards which outline how auditors should evaluate misstatements, including considering both quantitative and qualitative factors. Unadjusted misstatements exceeding the materiality threshold could result in a qualified opinion, an adverse opinion, or a disclaimer of opinion, depending on the nature and extent of the misstatements.