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Assignment in Materiality

Chapter 7 Strategic Management

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marylougeron111
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5 views

Assignment in Materiality

Chapter 7 Strategic Management

Uploaded by

marylougeron111
Copyright
© © All Rights Reserved
Available Formats
Download as DOCX, PDF, TXT or read online on Scribd
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Assignment in Materiality

In planning every audit, the auditors are required to consider materiality for audit purposes. Presented
below are selected data from the financial statements covering three-year period of STUWXYZ
Corporation.
(In million Pesos)
Toal Assets
2024 30,400
2023 32,100
2022 27,000

Total Revenue
2024 56,800
2023 49,200
2022 42,000

Gross profit
2024 22,400
2023 19,800
2022 16,200

Total Expenses
2024 15,100
2023 10,200
2022 7,500

Net Income before Taxes


2024 7,500
2023 9,600
2022 8,700

Required:
a. Develop an estimate of the appropriate materiality amount for planning
b. Describe briefly how you arrived at the estimated materiality
c. Show your computations
d. Submit your answer in PDF file

Suggested Format

A. Overall materiality selected


B. Materiality Benchmark (justify your choice)
C. Technical Benchmark selected
D. Starting Points selected
E. Show your computations
F. Resulting computed materiality
G. Provision for performance materiality

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