5-2-0 Oceanview Marine Company Preliminary Materiality December 31, 2018 1. Planning data Prior year Sales revenue (met) Expenses Gross margin Pre-tax income Current assets Current liabilities Total assets Materiality Current year (unaudited) 26,419,090 6,316,336 7.285,797 969.455 16.576,127 7.149,557 17.1/2.644 22,861,320 5,669.023 6,337,206 662,183 74,753,287 5,927.882 15,365,761 50.000 2. Preliminary Judgment about Materiality Measurement base (i.e., net income, revenue, assets) Percentage applied (rounded) Preliminary materiality % $ Materiality percentages: Pre-tax net income Assets Equity Revenue Gross profit 3 - 10% 1 - 1% - 5% 12- 1% 1-5% These materiality factors are provided as guidelines only, and should be used only as an aid in the development of your professional judgment. The materiality level should represent the largest amount of a misstatement or group of misstatements that would not, in your judgment, influence or change a decision based on the financial statements. Current workpapers--audit planning + Page 2