Materiality

Question 1

materiality refers to…

Answer 1

the amount that decisions would influence users

Question 2

quantitative criteria

Answer 2

1. nature of the idem
2. circumstances
3. uncertainty

Question 3

materiality is a matter of…

Answer 3

professional judgement

Question 4

materiality guides..

Answer 4

planning substantive procedure and evaluating evidence

Question 5

planning substantive procedures is used to..

Answer 5

direct attention to accounts or items that are important, uncertain or susceptible to error or frauds

Question 6

performance materiality is used to…

Answer 6

make sure the aggregate of uncorrelated and undetected immaterial misstatements does not exceed materiality as a whole

Question 7

planning materiality is applicable to..

Answer 7

overall financial statements

Question 8

performance materiality is…

Answer 8

maximum error that the auditor is willing to accept in a population

Question 9

trivial amounts is the..

Answer 9

posting scope

Question 10

performance materiality is usually what % of planning materiality?

Answer 10

50-75%

Question 11

trivial amounts is usually what % of big planning?

Answer 11

1-5%

Question 12

what misstatements should be communicated to management?

Answer 12

all but trivial

Question 13

when do you first assess materiality?

Answer 13

Q2

Question 14

when do you reassess materiality?

Answer 14

year end