Materiality is the concept that is used to evaluate whether accounting information is sufficiently significant to users of accounts such that it should not be omitted or misstated in the accounts. Materiality depends on the size of the item or error judged in the particular circumstances of its omission or misstatement. The concept of materiality is particularly important for auditors who must assess whether errors they find in accounts need to be adjusted before the accounts are finalised. (See also audit)


reference: Business Studies / Accounting. Accounts & Finance Glossary. Jim Riley BA(Hons) MBA FCA // tutor2u