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Materiality level

This topic has 1 reply, 2 voices, and was last updated 8 years ago by Ken Garrett.

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May 20, 2017 at 8:48 am #387086
seville
Member
- Topics: 1
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Hello,
Do we need to increase or decrease materiality if a sales-related bonus scheme has been introduced?
Thank you.
May 20, 2017 at 12:30 pm #387108
Ken Garrett
Keymaster
- Topics: 10
- Replies: 10597
You would look more closely at sales where there is now a risk of overstatement because managers want high bonuses.
You would decrease the materiality level to increase the chances of findimg smaller errors or being concerned about smaller errors.
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