Financial_Ethics_In_Business

Financial Ethics In Business Ethics plays a major part in auditing and financial record keeping. It is the responsibility of an independent auditor to plan and perform an audit of financial statements that will provide reasonable assurance of detecting errors and irregularities that are material in nature. According to the Financial Accounting Standards Board, the essence of the concept of materiality is: “The omission or misstatement of an item in a financial report is material if, in the light of surrounding circumstances, the magnitude of the item is such that it is probable that the judgment of a reasonable person relying upon the report would have been changed or influenced by the inclusion or correction of the item.” (www.fasb.org) Materiality is a term that is hard to quantify, and must be determined for each individual situation. Public accounting firms have established informal quantitative and qualitative measures in an attempt to establish materiality limits. These measures have been affected and enhanced by statements of the Securities and Exchange Commission and other regulatory agencies and professional organizations. In setting the preliminary judgment about materiality, auditors establish the maximum amount by which they believe the statements could be misstated and still not affect the decisions of reasonable financial, materiality, accounting, quantitative, sec, qualitative, statements, material, item, auditors, amount, 99, standards, sab, public, provide, measures, judgment, firms, fact, decisions, registrant’s, reasonable, nature, information, help, effect, determining, circumstances, change, bulletin, board, been, auditing, attempt, view