Audit Materiality and Performance Materiality How to Use Them

>> YOUR LINK HERE: ___ http://youtube.com/watch?v=oh0IPRBMJxY

Audit materiality and performance materiality are two of the most critical factors in an audit. Get this right, and you're on your way to a successful engagement. Get it wrong, and it could be disastrous. Materiality is key to audit planning, and finishing the engagement in a proper manner. Yet, CPA firms continue to receive peer review comments about these areas. See how materiality is used to guide you in your planning and in your concluding your audits. The video covers the selection and use of benchmarks and percentages to compute materiality. You'll also hear how intended financial statement users are considered in selecting a benchmark. • 00:00 Introduction • 00:10 Ingredients of materiality • 00:33 Benchmark • 01:27 Intended financial statement users • 01:53 Percent applied to benchmark • 03:10 Example of materiality • 03:50 Performance materiality • 05:17 Aggregate risk • 06:30 Cushion for undetected misstatements • 07:15 Lower materiality for risky areas • 08:33 FASB’s defines materiality • 09:12 Intended user is potential buyer of the company • 09:50 Using materiality • 11:00 Evaluating unposted audit entries • 12:42 Summary • #CPAHallTalk

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