what is audit materiaity?

**AUDIR MATERIALITY** Materiality is a concept or convention within auditing and accounting relating to the importance/significance of an amount, transaction, or discrepancy. The objective of an audit of financial statements is to enable the auditor to express an opinion whether the financial statements are prepared, in all material respects, in conformity with an identified financial reporting framework such as Generally Accepted Accounting Principles (GAAP). Thanks

misstatements, including omissions, are considered to be material if they, individually or in the aggregate, could reasonably be expected to influence the economic decisions of users made on the basis of the financial statements.

Materiality is an item of financial statements whose misstatement would influence the decision of users of financial statements. Audit materiality is an item, whose misstatement would influence the decision of users of financial statements. It is very subjective concept and changes from entity to entity, it can be decided on the basis of account balance, class of transactions and disclosures.

**Materiality** is the threshold above which missing or incorrect information in financial statements is considered to have an impact on the decision making of users.