With respect to the concept of materiality,which one of the following statements is correct?

Question

Quizplus · Accepted Answer

Materiality is a matter of professional judgment and cannot be confined to a specific quantitative threshold. While dollar amount is often a relevant factor, materiality can also be influenced by factors such as the nature of a transaction, its timing, and the financial reporting circumstances. Professional judgment must be used to evaluate the impact of these factors and determine whether a particular item is material to the financial statements. AICPA guidelines do provide some guidance on materiality, but they are not the sole determinant of materiality.

With Respect to the Concept of Materiality,which One of the Following