What evidence is there of application of the materiality concept in Research Paper

What evidence is there of application of the materiality concept in the report - Research Paper Example The most conspicuous evidence of the materiality principle in the preparation of JB Hi Fi’s financial report is minimal disclosure overload. According to the International Accounting Standards (IAS), most of the listed companies are expected to follow the structure as presented in paragraph 114 of IAS 1. However, JB Hi Fi is a conglomerate and deals with large volumes of financial information. Therefore, the company deals with complex financial information that requires sophisticated and alternative structures of presenting financial information. The company’s structure is different from the one proposed by international accounting standards, and better communicates the links between different pieces of information. Consequently, the company has enhanced its reflection of the financial position as well as the risks associated with the operation of the business. IAS proposes that listed companies should list intangible assets followed by trade and other receivables and finally trade and other payables when preparing the balance sheet. However, JB Hi Fi has a different order of items when preparing its balance sheet. The company lists trade and other receivables, intangible assets and trade and other receivables in an ascending order. JB Hi Fi bases its list of the balance sheet items on the importance of information presented in the financial report. Furthermore, the company cautions users of financial information not to read the financial statements in isolation. Rather, the company suggests that users of financial information should analyze financial statements in additional to reading notes to financial statements. The company’s statement of financial position has the three standard categories including assets, liabilities and equity. Each of these categories contains information about items related to each other for the sake of