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the materiality level is as follows :
1/2 – 1 % of Revenue
1 – 2% of Assets
5- 10% of Net Profit.When something is lets say 1.5 % of assets. will it be considered material or it is material when it crosses the above threshold ?
These are only guidelines and it depends on the entity (e.g. a not-for-profit entity does not have profit) and how these parameters are related to each other (e.g. if company is close to breakeven/making a loss).
With this in mind, less than the bottom of these ranges is generally considered not material whereas more than the top of these ranges is material. In-between is a matter of judgment taking into account any other relevant factors.
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