Disclosure issues: Materiality

Question 1

AASB 108 Para 5 Definition

Answer 1

Omissions or misstatements of items are material if they could, individually or collectively, influence the economic decisions that users make on the basis of FS

• Materiality depends on the size and nature of omission/misstatement
• Preparers need to make judgements about what is material

Question 2

AASB 101 Para 29 Implications for Disclosure

Answer 2

• Entity shall present separately each material class of similar items (items of dissimilar nature or function)
• If line item not individually material, then AGGREGATED with other items