Materiality consists of both quantitative and qualitative factors. Materiality is often considered in terms of monetary value but the inherent nature or characteristics of an item or group of items may also render a matt

Materiality consists of both quantitative and qualitative factors. Materiality is often considered in terms of monetary value but the inherent nature or characteristics of an item or group of items may also render a matter material. Issues that may be considered material even if the monetary value is not significant would include the following: Material by value Material by nature Material by context Fraud; Intentional unlawful acts or non-compliance; Incorrect or incomplete information to executive, the auditor or to the legislature (concealment); Intentional disregard to the executive, authoritative bodies or auditors; and Events and transactions made despite knowledge of the lack of legal basis to carry out the particular event or transaction. Is materiality not a matter of professional judgement? Materiality is a matter of professional judgment and depends on the auditor's interpretation of the users' needs. A matter can be judged material if knowledge of it is likely to influence the decisions of the intended users. Materiality should be considered by auditor while determining the nature, timing and extent of audit procedures and while evaluating the effect of misstatement.