What is the answer

Question 7 (1 point) An auditor is working on the audit engagement for a community shelter that is a not- for-profit organization. Most of the shelter's funding comes from the municipal government, and the government is a key user of the financial statements. Due to a recent accounting scandal, the municipal government is sensitive to misstatements. Which one of the following would be the MOST appropriate threshold and benchmark for the auditor's materiality determination? O a) 1% of expenses ) b) 3% of equity C) 3% of normalized income before taxes O d) 4% of total assets