In planning and performing the compliance engagement, ASAE 3100 requires the auditor to consider materiality and compliance engagement risk.  In assessing materiality, the auditor considers qualitative and quantitative factors.


In determining whether a contravention identified is material, and therefore whether a modification to the auditor’s report is warranted, the auditor considers factors such as:

  • the quantum of the breach;
  • the time taken to rectify the breach, or if not yet rectified, the trustee’s proposed actions and timeline for rectification;
  • whether the auditor has previously reported a similar breach to the trustee;
  • the extent to which a limit has been exceeded or a statutory deadline missed;
  • whether the breach was intentional; and
  • actual or potential damage to members of a breach of the SISA or SISR occurring.