Evaluating Materiality in Cybercrime Footnotes
G. Stevenson Smith · Journal of Corporate Accounting & Finance · 2015
New risks face companies dependent on the Internet for their core business processes. New risks come from cyber breaches and attacks from hackers. The results of these challenges are requirements for new footnote disclosures. The article reviews the manner in which those risks have been reported in financial statements based on the materiality of the event. Disclosures for identity theft breaches and bank theft attacks are considered. Questions are raised as to whether intangible losses need to be considered in determining the materiality of a cyber incident as well as suggestions as to how those losses can be estimated. © 2016 Wiley Periodicals, Inc.