A normative reference framework for determining audit materiality
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Date
Authors
Botha, W.J.J. (Willem Johannes Jacobus)
Gloeck, Juergen D. (Juergen Dieter), 1956-
Journal Title
Journal ISSN
Volume Title
Publisher
Southern African Institute of Government Auditors
Abstract
Materiality is a central concept in the process which is applied during the external audit of company annual financial statements. Guidelines issued by professional standard-setting bodies generally state that the determination of audit materiality is primarily a matter of professional judgement. A normative analysis and description of the materiality concept in auditing led to the formulation of specific normative principles in respect of determining audit materiality which are presented in this article. These normative principles are summarised and discussed in a normative reference framework for determining audit materiality. The normative reference framework represents the factors which should influence the external auditor's decisions in respect of determining audit materiality and, therefore, provides external auditors with specific guidance in this regard. The application of normatively based decision making processes serves to enhance the accountability of the duties and functions of the external auditor
Description
Keywords
Audit materiality, External audit, Professional judgement, Audit planning, Postulates, Evaluation of audit procedures, Materiality studies, Reference framework
Sustainable Development Goals
Citation
Botha, WJJ & Gloeck, JD 1998, 'A normative reference framework for determining audit materiality', Southern African Journal of Accountability and Auditing Research, vol. 1. [http://www.saiga.co.za/publications-sajaar.htm]