• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for September 2025 exams.
Get your discount code >>

materiality calculations

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA AAA Exams › materiality calculations

  • This topic has 5 replies, 2 voices, and was last updated 3 years ago by Kim Smith.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • November 26, 2021 at 7:21 am #641661
    Noah098
    Member
    • Topics: 935
    • Replies: 352
    • ☆☆☆☆☆

    ma’am do we need to show in brackets or in separate table etc the materiality calculations method like: X/Y x100 ?

    or we can straightaway write the direct answer?

    November 26, 2021 at 7:53 am #641664
    Kim Smith
    Keymaster
    • Topics: 133
    • Replies: 8305
    • ☆☆☆☆☆

    I think that is just my advice how you can clearly earn the credit – it is just a convention for answers generally (not just AAA) too show where a % comes from. Since this is not an exam where “all workings must be shown” you would get credit for a % of a specified benchmark being correct without the working.

    November 27, 2021 at 9:50 am #641775
    Noah098
    Member
    • Topics: 935
    • Replies: 352
    • ☆☆☆☆☆

    ma’am I wanted to confirm one more thing: while making materiality calculations for an item we need to make a judgment call right, whether to calculate it with respect to profit or assets?

    And what if in panic we are not able to decide whether to calculate it with respect to assets or profits, and so decide to go ahead and calculate it with respect to both? so long as the calculations are correct will we get 1 mark for it?

    November 27, 2021 at 10:02 am #641778
    Kim Smith
    Keymaster
    • Topics: 133
    • Replies: 8305
    • ☆☆☆☆☆

    But BOTH may well me relevant e.g. if there is a risk that impairment may not be recognised the other side of the debit P/L is credit PPE. THIS is not a matter of judgment. The judgment is if, for example, if % PBT is > 5% but less than 1% total assets.

    But to reassure you – all relevant materiality calculations will be credited subject to the “cap” on marks – and there is not negative marking – so marks won’t be deducted for unsuitable calculations (they just won’t be credited!)

    December 4, 2021 at 1:48 pm #642492
    Noah098
    Member
    • Topics: 935
    • Replies: 352
    • ☆☆☆☆☆

    In completion and review questions,

    when there is immaterial misstatement then, do we say that “there is a risk that X and Y are understated due to immaterial misstatement”

    Or we DO NOT use the word RISK at all, and simply say that “due to immaterial misstatement X and Y are understated”

    Sorry for bothering you with such silly doubts ma’am

    December 4, 2021 at 3:31 pm #642504
    Kim Smith
    Keymaster
    • Topics: 133
    • Replies: 8305
    • ☆☆☆☆☆

    Before you audit there is the possibility “risk” of misstatement – by the time the auditor has obtained sufficient audit evidence, he should know whether or not there is material misstatement. I don’t know why you are writing about immaterial misstatements – if you meant material, then do take care in the exam to write what you mean.

  • Author
    Posts
Viewing 6 posts - 1 through 6 (of 6 total)
  • You must be logged in to reply to this topic.
Log In

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • Bimasha@123 on Discounted Cash Flow Techniques – ACCA Advanced Performance Management (APM)
  • Ken Garrett on Discounted Cash Flow Techniques – ACCA Advanced Performance Management (APM)
  • Bimasha@123 on Discounted Cash Flow Techniques – ACCA Advanced Performance Management (APM)
  • John Moffat on AA Chapter 7 Questions
  • John Moffat on FA Chapter 12 Questions Sales Tax

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in