The materiality concept requires that a company should report enough information for outsiders to make wise decisions about the company.

Question

Quizplus · Accepted Answer

The materiality concept in accounting states that all significant information should be reported in the financial statements, but it specifically focuses on the importance of information in affecting decisions rather than ensuring enough information for wise decision-making. It's about the significance of transactions or events, not the volume of information.

The Materiality Concept Requires That a Company Should Report Enough