The Impact of Materiality: Accounting's Best Kept Secret

Niamh Brennan () and Sidney J. Gray
Additional contact information
Sidney J. Gray: School of Business, University of Sydney

Asian Academy of Management Journal of Accounting and Finance (AAMJAF), 2005, vol. 1, issue 1, 1-30

Abstract: This paper comprises a review of the literature on materiality in accounting. The paper starts by examining the context in which materiality is relevant, and the problems arising from applying the concept in practice. Definitions of materiality from legal, accounting and stock exchange sources are compared. The relevance of materiality to various accounting situations is discussed. Methods of calculating quantitative thresholds are described and illustrated. Prior research is reviewed, focusing on materiality thresholds, and on the materiality judgments of auditors, preparers and financial statement users. The paper concludes with some suggestions for future research and for policy makers concerning this best kept accounting secret.

Keywords: materiality definitions; materiality thresholds; materiality rules of thumb; materiality judgments (search for similar items in EconPapers)
Date: 2005
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

Downloads: (external link)
http://web.usm.my/journal/aamjaf/vol1/1-1.pdf (application/pdf)

Related works:
Working Paper: The impact of materiality: accounting’s best kept secret (2005)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:usm:journl:aamjaf00101_1-30

Access Statistics for this article

More articles in Asian Academy of Management Journal of Accounting and Finance (AAMJAF) from Penerbit Universiti Sains Malaysia Contact information at EDIRC.
Bibliographic data for series maintained by Journal Division, Penerbit Universiti Sains Malaysia ().