Information is material if omitting or misstating it could reasonably be expected to influence the decisions of the primary users of general purpose financial statements. This is most closely associated with which statement?

• A. A It is always material for large organisations
• B. B Materiality is the same for all entities
• C. C Materiality depends on the size of the organisation
• D. D Materiality is not defined in IFRS

Answer: (C)

Materiality hinges on the size and context of the entity. The idea is that information is material if omitting or misstating it could influence the decisions of the primary users of general purpose financial statements. Because different entities have different scales, operations, and environments, the threshold for what counts as material varies. So stating that materiality depends on the size of the organisation best captures how materiality works in practice. The other ideas don’t fit as well: it’s not true that something is always material just because an organisation is large, since even large entities can have immaterial items; materiality isn’t the same for all entities—thresholds differ by size and circumstances; and materiality is defined in IFRS as a matter of professional judgment, not a fixed rule.