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Has SEC's Y2K policy thrown materiality out the window?
Author(s) -
Urbancic Frank,
Sylvestre Jeanne,
Hsu Ko
Publication year - 1999
Publication title -
journal of corporate accounting and finance
Language(s) - English
Resource type - Journals
eISSN - 1097-0053
pISSN - 1044-8136
DOI - 10.1002/(sici)1097-0053(199922)10:4<55::aid-jcaf5>3.0.co;2-3
Subject(s) - materiality (auditing) , commission , accounting , sample (material) , business , economics , finance , art , aesthetics , chemistry , chromatography
A study of 280 companies implies that ad hoc actions by the Securities and Exchange Commission (SEC) on Year 2000 Problem (Y2K) disclosure virtually replaced the time‐honored, established practice of using materiality as the basis for financial reporting. Not one company in the random sample had a material impact from fixing the Y2K “problem.” So we have to ask: Did the SEC overreact? © 1999 John Wiley & Sons, Inc.