• IFRS Practice Statement 2 Making Materiality Judgements

IFRS Practice Statement 2 Making Materiality Judgements

14 September 2017

The International Accounting Standards Board has issued IFRS Practice Statement 2 Making Materiality Judgements

 

The Practice Statement:

  • provides an overview of the general characteristics of materiality;
  • presents a four-step process companies may follow in making materiality judgements when preparing their financial statements; and
  • provides guidance on how to make materiality judgements in specific circumstances; namely, how to make materiality judgements about prior-period information, errors and covenants, and in the context of interim reporting.

The Practice Statement is a non-mandatory document. It does not change or introduce any requirements in IFRS Standards and companies are not required to comply with it to state compliance with IFRS Standards.

Companies are permitted to apply the guidance in the Practice Statement to financial statements prepared any time after 14 September 2017.

Further information is available from the IASB web site here.