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Considering Multiple Materialities for Account Combinations in Audit Planning and Evaluation: A Cost Efficient Approach

Year: 1998

Type: article

Abstract: An analytic framework is provided for incorporating different user perspectives on materiality into the audit process. The framework serves as a tool for disaggregating materiality to specific accounts based on materiality criteria for accounts and account combinations. To improve audit efficiency, the planning method incorporates the relative cost of auditing various account balances. It extends existing models of audit risk and materiality by considering explicitly the materiality of account combinations (sums and ratios) to enhance audit effectiveness.

Source: Journal of Accounting Auditing & Finance

DOI: 10.1177/0148558x9801300204

Authors: Saurav K. Dutta, Lynford E. Graham

Institutions: Rutgers, The State University of New Jersey, State University of New York, University at Albany, State University of New York, Bentley University

Language: English

Topic: Auditing, Earnings Management, Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: green

OpenAlex ID: W1552128594

FWCI: 1.754

Cites: 7

Cited by: 15

Related to: 10