The materiality concept is the principle in accounting that distinguish matters that are to be disregarded or are to be disclosed. This is the concept where an organization decides whether the items are large enough to be disclosed. These items are categorized as material items. The concept of materiality is relative in size and importance. Some financial information might be material to one company but might be immaterial to another. This can be seen by observing two different companies-a small company and a large company. A large and material expense to a small company might be small an immaterial to a large company because of their size and revenue. For instance,
- A large company has a building in the earthquake zone. In an earthquake,
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Material information influences the economic decisions of the users and is therefore relevant to their needs (Relevance). It is also linked with reliability. Omission or misstatement of an important piece of information reduces users’ ability to make correct decisions taken on the basis of financial statements thereby affecting the reliability of information. Moreover, information contained in the financial statements must be complete in all material respects in order to present a true and fair view of the affairs of the company. This is known as …show more content…
The company should adjust its financial statements.
Examples: Nature of the event
1. EW Casinos Corporation operates in a country which is about to enact a new legislation which would seriously impair the company's operations in future. Although there are no figures involved, the disclosure of the development is required in the financial statements for the period on account of materiality because the new legislation can potentially end the revenues and profits earned from the country.
2. The remuneration paid to a company’s executives and directors is material due to qualitative reasons (even it is not material quantitatively). It is because the investors would like to make sure that the management is not overcompensating itself.
3. The accounting policies are material and can’t be omitted because they help the users understand how the management arrived at the amounts presented in the financial
Executive compensation has come under increasing scrutiny in recent literature in the wake of the growing publicity surrounding managerial failures and executive self-interest. Financial experts have long been examining the problem of aligning the performance of executives with their salaries and benefits. Public discontent with the visible top-heaviness of the compensation structure has brought this issue into the spotlight throughout the business world. Experts point to the flaws of traditional payment schemes and offer a number of different solutions. Shareholder value and the success of the firm can be significantly affected by executive performance. Hence, understanding the advantages and costs of the current trends in executive compensation is crucial to the compensation committee of a Fortune 500 corporation.
According to the conceptual framework, the potential users of financial statements are investors, creditors, suppliers, employees, customers, governments and agencies, and the general public (Financial Accounting Standards Board, 2006). The primary users are investors, creditors, and those who advise them. It goes on to define the criteria that make up each potential user, as well as, the limitations of financial reporting. The FASB explicitly states that financial reporting is “but one source of information needed by those who make investment, credit, and similar resource allocation decisions. Users also need to consider pertinent information from other sources, and be aware of the characteristics and limitations of the information in them” (Financial Accounting Standards Board, 2006). With this in mind, it is still particularly difficult to determine whom the financials should be catered towards and what level of prudence is necessary for quality judgment.
If we take time and observe our surroundings, we see people are more concerned about the amount of Louis Vuttons or Michael Kors bags does one purchase than being aware of the person well being because this world today is all about objects than people. The author of the case of consumer society has presented the modern society in such a way that if we stop and think and look around how are generation today has become, making our world a world of materialism. According to karl marx, our world today is a world of objects as mentioned in the case that we have started given priotity more to our purchases than to people around us for example in a gathering of teens, half of them you will notice will be on their gadgets rather than communicating with the people around. This materialism according to marx is due to the rise of capitalism, where people are easily manipulated into making choices which benefit the economy and most of the time we do not even realize it. The whole concept of Shopping malls we see nowdays is a tool of manipulation, have been made the place of goods, acitivies and leisure for the consumers that they become entangled in the shadows of the capitalists.People nowdays go to shopping malls , hangout and do some window shopping and come back stating that it was an outing rather than having any interaction with other people , we chose to interaction with objects to fulfil our desire. Even the way producrts are arranged are not coincidental but a technique of manipulation for example if the product is arranged in a attractive way, consumers automatically get attracted to it rather then the product which is arranged in a disorganize way.This proves what Marx says that consumers in the capitalist society donot have any so...
Hobbes’ Materialism religion is portrayed as distinctly similar to Descartes’ in the sense that there is the staunch belief of a supreme being in existence. Descartes suggested that philosophy and material substance mattered as demonstrated by motion whereby an entity’s existence was only based on motion. Descartes had the belief that the earth was formed by a supreme entity, God, who assumed his place as the creator and watched the creation thriving and running dynamically and independently without any supernatural influence (Rogers 1988).
CEO compensation has been a heated debate for many years recently, and it can be argued that they are either overpaid or that there payment is justified by the amount of work they do and their performance. To answer the question about whether CEO compensation is justified it must be looked at by the utilitarian viewpoint where the good of many outweighs the good of one. It is true that many CEO’s are paid an exorbitant amount of money; however, their payment is justified by the amount of money that they bring back to the company and the shareholders. There are many factors that impact the pay that the CEO receives according to Shah et.al CEO compensation relies on more than just the performance of the CEO, there are a number of factors that play a rule in the compensation of the CEO including the fellow people who help govern the corporation (Board of Directors, Audit Committee), the size of the company, and the performance that the CEO accomplishes (2009). In this paper the focus will be on the performace aspect of the CEO.
Humans across time are and have been very attached to material items. Humanity as a whole seems undecided about whether this attachment is a good or bad thing. The central concept behind the buddhist religion is of distancing oneself from attachments to the material world (financial wealth, physical objects, etc...) in order to reach enlightenment, and in the afterlife, the heaven-like Nirvana. On the other hand, many socio-political systems, capitalism especially, rely on this materialism in order to thrive. In truth, materialism is not entirely good or bad, speaking in terms of both the self and society, and while it is capable of corruption, it can also be a driving motivation in improving one's identity.
Financial and Managerial accounting are used for making sound financial decisions about an organization. They provide information of past quantitative financial activities and are useful in making future economic decisions. (Albrecht, Stice, Stice, & Skousen, 2002) The same financial data is used to derive reports for each accounting process yet they differ in some ways. Financial accounting primarily provides external reports for external users such as stock holders, creditors, regulating authority and others. (Garrison, Noreen, & Brewer, 2010) On the other hand Managerial accounting is concern with providing information that deals with the internal viability of the organization and is tailored to meet the needs of an individual organization. (Albrecht, Stice, Stice, & Skousen, 2002)
In philosophy, the majority of studies relate to the mind. Whether it is the main subject or just a helpful side topic to move the main subject along, this term is used often. Defining the term mind is difficult, and is a topic that is popularly studied and debated among philosophers. These qualified and knowledgeable people try to determine whether or not the mind is who people are or if they are their body or a combination. Although they have learned many helpful truths and defined other useful terms, the debate is still evident in the philosophical community today. Learning about how the mind relates to the body, and whether the mind and the brain are the same thing are other ways to look at the many options of how to discern
After Immanuel Kant, there was so much that went on such as the start of the Contemporary theory of science. Before all of this aroused, the big argument was idealism versus materialism. This was big because modernism had made people choose which side between the two concepts. There were a lot of disagreements between the two because a lot of people were still stuck on the concept of materialism. Materialism is the physical appearance of everything , and that everything is made out of atoms and matter instead of just being the physical appearance of the object. At this point in time Materialism was the dominant voice in science. But as time starts to go on more and more people start to turn towards the new concept of idealism, which is basically stating that instead of the physical appearance of an object is actually not made of atoms, and it is just perceived that way in our mind. For example, people who believe in Materialism would say that a cup itself is not just a solid, but it is made up of atoms and electrons. On the other hand, Idealists would say that the cup is just a solid, they wouldn’t mention anything about the atoms or electrons. Along with the disagreement between Idealism and Materialism, there were also many developments that aroused after Immanuel Kant. These developments range from non-Euclidean geometry, to several philosophers working with the quantum theory, to Werner Heisenberg discovering the uncertainty principle.
Shared Thoughts, beliefs and values which are recognized by a specific community. Basically, the nonmaterial culture is the construction and the base of society, it provides boundaries among people by which particular groups operate and understand each other. The significance of non material culture is essential to people, in order to shape and identify their own society.
Culture has a variety of meanings in our daily lives. Culture is defined as objects created by a society as well as the ways of thinking, acting, and behaving in a society (Macionis). Culture has a variety of elements that is important in understand. To grasp culture, we must consider both thoughts and things. Culture shapes not only what we do, but also what we think and how we feel.
Accounting is the pillar of every company to measure its growth, loss, revenue , capital, its really specify the real terms in foam of figures and sometimes in tables, in accounting there are certain rules are obtained to make more accuracy while playing with figures.
Remuneration management is defined as the sum received for an employment or service delivered, this includes the money received on a monthly basis as well as benefits given as rewards (investopedia,para.1 ). Individualism need to be taken into account when implementing these remuneration structures or reward schemes, equal pay plays a role in balancing earnings among the diverse workforce (Shen, Chanda, D’Neetto and Monga,2009,p.241). The Woolworth’s Holdings uphold remuneration policies which have the purpose of making sure to attract and hold on to the best talent, that they are congruent with the strategies of the company and are the determinants of performance during the short and long phases. The policy considers the board members and the employees. This policy manages employees of the company by giving...
In the memoir, Tuesdays with Morrie by Mitch Albom, Morrie an old man who has a terminal illness ALS in his last months teaches Mitch a man who has been half sleep all his life as Morrie would say, many life lessons, but one that really got my attention was that Money cannot buy love or happiness. Morrie would say that materialistic people think that money can buy love and happiness, but it is not true, neither of those things have a price.
Materialism is very complex, and can be defined on a number of different platforms. There is no one definite definition of materialism, meaning there is an ambiguity surrounding the construct of materialism. According to Kasser et al. (2004), consumers develop a materialistic value orientation at times when they experience feelings of insecurity, and from exposure to materialistic models and values. When the psychological needs of individuals are not met, they tend to move toward materialism in order to help them feel better about themselves, and reduce feelings of insecurity and self-doubt through the consumption of materialistic items.