Shubham MangalShubham asked 2 years ago
7 Answers
RaviRavi Staff answered 2 years ago

clearly trivial means very small 1% to 5% of materiality value, such misstatements below this amount should be ignored.
performance materiality is 50% to 90% of original materiality , so that audit team is conservative and cautious while designing and performing audit procedures

Auditaudit Staff answered 2 years ago

Sir these three concepts are not clear clearly trivial performance Materiality and materiality

Auditaudit Staff answered 2 years ago

Suppose if we take eg of reliance fst how can we decide materiality

Auditaudit Staff answered 2 years ago

400000crores TO

Auditaudit Staff answered 2 years ago

Which u hv included in ur classes in disclosures. Of segment info

Auditaudit Staff answered 2 years ago

Sir please reply to this query

RaviRavi Staff answered 2 years ago

Suppose reliance has profits of 30,000 Crore annually
as base amount is big we take 1 % as materiality 
so initial materiality is 30,000 x 1 % = 300 Crore
Now performance materiality will be say 60% of initial materiality so it will be 300 x 60% = 180 Cr
Clearly Trivial limit is say 1 % so it will be 180 x 0.5% = 0.9 Cr , misstatement below this may not be accumulated

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