Materiality is assessed after the trial balance has been loaded, and normally it is best to determine this prior to risk identification.
- The materiality page draws data from the trial balance to display a range of values for revenue, expenditure, assets and excess income over expenditure
- These ranges are suggestions only and drawn from common practice – the final assessment is entirely up to the auditor exercising their professional judgement and their knowledge of the client:
- The user is asked to explain the rationale for their decision
- The user is also asked to assess a level for performance materiality – there may be different levels of performance materiality for different balances or classes of transaction if required
- A level for trivial misstatements must also be identified
- These fields are then displayed in the sidebar:
TIP: Performance materiality is used for transaction sample selection – setting it too low may lead to over-auditing