What Is Performance Materiality

question 98

Multiple Choice

What is performance materiality?

• A)Amount or amounts set by the auditors at less than the materiality level for particular classes of transactions, account balances, or disclosures
• B)Information or misstatements that impact a user's decision-making process for a reason other than its magnitude
• C)Information or misstatements that exceed the magnitude of an auditor's preliminary materiality assessment, which is a percentage of an appropriate benchmark
• D)None of these options are correct.

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Definitions:

Relatively Short

The term "relatively short" refers to a period of time that is short in comparison to other relevant timeframes or expectations.

Technological Changes

The overall process of invention, innovation, and diffusion of technology or processes.

Direct Lease

A lease where the lessor purchases the asset and then leases it directly to the lessee, without using a lease intermediary.

End User

The ultimate consumer of a product or service, who uses it for its intended purpose.