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Could you please clarify this, the Examiner set Materiality level to be $800,00 for asset & Liability. $250,000 for income and expenses.
The disputed issues with obsolete inventory of an amount of $130,000 were not provided for.
An amount of $125,000 provision were not made either.
In the Examiner answer, she said the amount involved are immaterial to the individuall profit and assets which contrary to my understanding of material. 0.5-1% of Turnover, 1-2% of Total assets, 5-10% of PBT.
I look forward to your input.
I presume that Lisa said something like “Whilst the individual amounts were not material, in aggregate the adjustment to profits would be.
Am I wrong?
Thank you for your time.
Are you also saying these items are not material to FS individually?. 130/800, 125/250.
Of course she mentioned that the aggregate is material.
Individually and clearly, it is material.
I’m really confused.
The figures of 800 and 250 are the materiality levels – they are not the total value of the assets / revenues / profits. They are the materiality levels!
Thank you very much.
I was taking it for the Total Assets/Liability & Income/Expense figures.
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