BUS 426 Chapter Notes - Chapter 7: Financial Audit, Specific Performance, Net Income

• School: Simon Fraser University
• Department: Business Administration
• Course: BUS 426
• Professor: Craig Emby

Document Summary

Judgements made in light of surrounding circumstances and are affected by the size or nature of a misstatement, or a combination of both. Judgements about matters that are material to users of the financial statements. Based on a consideration of the common financial information needs of users as a group. Materiality is a driver of the entire process in: planning the audit (risk assessment phase) The decisions made in this phase provide benchmarks for decisions throughout the audit about. Specific performance materiality: evaluating the results (risk response phase, completing the audit (reporting phase) Refers to determining materiality for the financial statements as a whole. Identify appropriate financial data for the selected benchmark: determine the percentage to be applied to the selected benchmark. Mature entity that is financed by equity (public. Net income before taxes company with shares widely held) performance. Start-up entity that is financed by equity and. Revenue, assets, or net has not yet generated net income.