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Valve timing

Folks,
a short but very important question......
Which method is used to set the valve timing?
Is it
a) Dot on cam sprocket lined up with cam cover and flywheel '0'
or
b) Dot on cam sprocket lined up with cam cover and mark on crankshaft pulley
   lined up with pointer on block

TIA,
George Harrison,
Co. Kildare,
Ireland.

'85 ur-quattro
'86 80 Sport