Empirical Study on the Implications of Qualitative Factors in Making Decisions Related to the Materiality Level: The Case of Romania

What is it about?

The paper aims to present the importance of qualitative factors in determining the materiality level in an audit mission. According to the literature a quantitative approach of materiality is insufficient for appropriate decisions, therefore it is required a more serious treatment of this issue. Data collected in the research were processed using the Ordered Logit Model, and the results showed that there is a significant correlation between the materiality level and the sectors in which the audited companies operate, the auditor’s experience in the field and the longevity of the relationship with the client. There is no any correlation between the materiality level and the needs of the users of financial statements or the management objectives.

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