The materiality principle in the accounting and ‘non accounting’ dimensions: is there a common path?

This paper explores the concept of materiality and applies it in particular to the emerging phenomenon of Integrated Reporting. Materiality, in very general terms, relates to the concept that information which is worth transmitting via the corporate reporting process should be expected to have some influence or effect on the behaviour of the recipient. Why IR? Because it represents a ‘tension point’ since it combines two different kinds of information and approaches: the accounting and the non-accounting approach (in some cases close to social and environmental reporting and assurance). This situation “creates potential tensions between logics” (Edgley et al., 2015, p. 2). The paper analyses the evolution of the concept of materiality and its relationships with other principles (including particular reference to the subset of papers analysing materiality within IR). The principle is not considered as an autonomous element, but as one of the aspects of a holistic system of principles and concepts that reinforce themselves and allow the concrete and effective working of the materiality principle. By using an innovative classification and schema generally not adopted within the international literature, this research can help the understanding of the materiality principle in its multidimensional approach and function. The paper also analyses the contributions arising from the main international accounting standard setter (IASB), the main international auditing standard setter (IAASB), and from professional bodies and organisations (IIRC, IRC of South Africa, GRI, AccountAbility).