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materiality

Apparently what the client deem to be material is the threshold we should use for our materiality. To defend them, I guess it's understandable that our materiality would be so low at times, and small amounts to them could potentially be big numbers to us. But that's why we're much better off working with clients who had public accounting experience, and thus know what materiality means. No wonder public accountants are in such demand these days.

Comments

Krupo said…
Whoa, that's pretty ridiculous sounding to me.

Standard definition is the smallest amount that would influence an investor (or similar party's) decision on whether or not they should invest in a company.

Auditors determine it, never the client. How odd to hear that version!
notfordisplay said…
haha, my blog posting was sarcastic..essentially saying that they had a certain perception of materiality and they look at it from just a big number standpoint.

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