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  3. question – factors to be considered for determining materiality. ans – An item whose is insignificant at present, but in future it may be significant, may be material item. Plz sir explain this point
Questions › Category: SA-320 › question – factors to be considered for determining materiality. ans – An item whose is insignificant at present, but in future it may be significant, may be material item. Plz sir explain this point
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Ashish PatelAshish Patel asked 7 years ago
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RaviRavi Staff answered 7 years ago

for example company is in expansion mode, capital WIP is appearing in balance sheet. company has done wrong capitalisation of expenses in LAND account instead of building, today it doesnt have significant impact on balance sheet as heading is same. but in future when capitalisation completes and depreciation will be charged then impact may be material