AASB 101 - Presentation of Financial Statements - October 2006
Materiality and AggregationMateriality and Aggregation
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Materiality and Aggregation
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Each material class of similar items shall be presented separately in the financial report. Items of a dissimilar nature or function shall be presented separately unless they are immaterial.
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Financial reports result from processing large numbers of transactions or other events that are aggregated into classes according to their nature or function. The final stage in the process of aggregation and classification is the presentation of condensed and classified data, which form line items on the face of the balance sheet, income statement, statement of changes in equity and cash flow statement, or in the notes. If a line item is not individually material, it is aggregated with other items either on the face of those statements or in the notes. An item that is not sufficiently material to warrant separate presentation on the face of those statements may nevertheless be sufficiently material for it to be presented separately in the notes.
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Applying the concept of materiality means that a specific disclosure requirement in an Australian Accounting Standard need not be satisfied if the information is not material.