Limelite is a Joint Stock Company in Muscat, Sultanate of Oman. Limelite was established in 2012 and has since been leading Oman Cellular Phone Accessory manufacturer, producing diverse range of cellular phone protective screens, covers and ring-holders. Recently Limelite Patent the Limelite Glove a shock resistant cover for the cellular phones.

The following is the summary of the year end receivables balances of Limelite Manufacturing and the equivalent figures for the previous year. Performance materiality has been set at RO. 5,000.

Customer

Jamal Ahmed

Shahin Mohammed

Jaffar Ali

Jamila Khan

Nooruddin 20,500

Other Customers all with balance under RO. 1,000

Jaffar Ali went into liquidation during the year.

Question 3:

16,600 ---------- 48,600 ======

2016

2015

2,400 3,000 2,000 1,100

18,900 7,400

----------

34,800 ======

2,500 6,000 2,000 1,000

(i) Set out which of the above balances as a minimum, the auditor should select for listing and explain. Why? (3 Marks) (ii) Discuss the concept of Materiality Level with reference to the case let. (2 Marks)