There are various provisions in the Corporate Laws, where the material information is required to be disclosed. It serves the purpose of the law makers to bring the transparency and to protect the interest of stakeholder

Materiality is a concept or convention within auditing and accounting relating to the importance/significance of an amount, transaction, or discrepancy in the records of the company. Materiality can be defined as the magnitude of an omission or misstatement of information that, in the light of surrounding circumstances, makes it probable that the judgement of a reasonable person relying on the information would have been changed or influenced by the said omission or misstatement. Materiality is the threshold above which missing or incorrect information is considered to have an impact on the decision making of the Auditor. Information is considered as material if its omission or misstatement could influence the opinion of the Auditor. The disclosure of important matters helps the users, stakeholders in taking business decisions and thus, there should be neither suppression of vital facts nor misstatements. The significance of materiality may be enumerated as under: The concept of materiality plays a decisive role in the whole audit process. The user of the audit report does not require the absolute accuracy to take informed decisions. The concept of materiality should be considered by the auditor while determining the nature, timing and extent of audit procedures and evaluating the effects of the misstatements. 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. Materiality is a matter of professional judgement and depends on the auditor's interpretation of the user's needs. A matter can be judged material if knowledge of it is likely to influence the decisions of the intended users. Materiality is determined for planning purposes, evaluating the evidence obtained and the effect of identified instances of misstatements or non-compliances and for reporting the results of the audit work.