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What measurement base should be used? Why? What percentage should be applied? Why? EARTHWEAR CLOTHIERS Planning Materiality December 31, 2019 (In thousands) 3-7 Initial Here

What measurement base should be used? Why?

What percentage should be applied? Why?

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EARTHWEAR CLOTHIERS Planning Materiality December 31, 2019 (In thousands) 3-7 Initial Here 9/1/21 1. Benchmark Data Sales / Revenue Pre-tax income Total assets Materiality Unaudited 2019 $1,019,890 $70,154 $389,428 2018 $950,484 $35,757 $329,959 $1,800 2. Establish Planning Materiality Level Measurement Base Select Measurement Base Using The Yellow Cell on the Left Percentage Applied* Input a Percentage Here Based on the Guidelines Below Planning Materiality Please Complete Cells Above Bases and Percentage Ranges: Profit Oriented Entities Pre-tax income 3 - 7%* Total Revenue 0.5 - 3% Total Assets 0.25 -2% *For public companies, 5% is typicaly the maximum. Not-for-Profit Entities Total Revenue 0.5 - 3% Total Assets 0.25-2% Mutual Fund Entities Net Asset Value 3-5% Please use this template in conjunction with Wilis & Adams Materialty Guideines. The materialty factors provided are guidelines only and should be used only as an aid as you use professional judgment to determine planning materialty. 3.Justify Support Your Level of Planning Materiality State the factors that you considered to determine the appropriate measurement base and percentage to determine planning materiality. Measurement Base: Enter your response here Percentage: Enter your response here EARTHWEAR CLOTHIERS Planning Materiality December 31, 2019 (In thousands) 3-7 Initial Here 9/1/21 1. Benchmark Data Sales / Revenue Pre-tax income Total assets Materiality Unaudited 2019 $1,019,890 $70,154 $389,428 2018 $950,484 $35,757 $329,959 $1,800 2. Establish Planning Materiality Level Measurement Base Select Measurement Base Using The Yellow Cell on the Left Percentage Applied* Input a Percentage Here Based on the Guidelines Below Planning Materiality Please Complete Cells Above Bases and Percentage Ranges: Profit Oriented Entities Pre-tax income 3 - 7%* Total Revenue 0.5 - 3% Total Assets 0.25 -2% *For public companies, 5% is typicaly the maximum. Not-for-Profit Entities Total Revenue 0.5 - 3% Total Assets 0.25-2% Mutual Fund Entities Net Asset Value 3-5% Please use this template in conjunction with Wilis & Adams Materialty Guideines. The materialty factors provided are guidelines only and should be used only as an aid as you use professional judgment to determine planning materialty. 3.Justify Support Your Level of Planning Materiality State the factors that you considered to determine the appropriate measurement base and percentage to determine planning materiality. Measurement Base: Enter your response here Percentage: Enter your response here

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