Doesn't cut it.
Materiality concerns the significance of an item to users of a registrant's financial statements. A matter is "material" if there is a substantial likelihood that a reasonable person would consider it important.
The omission or misstatement of an item in a financial report is material if, in the light of surrounding circumstances, the magnitude of the item is such that it is probable that the judgment of a reasonable person relying upon the report would have been changed or influenced by the inclusion or correction of the item.3
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3
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FASB, Statement of Financial Accounting Concepts No. 2, Qualitative Characteristics of Accounting Information ("Concepts Statement No. 2"), 132 (1980). See also Concepts Statement No. 2, Glossary of Terms - Materiality. |
If you know what we know about the licensing (ore even if you do not), then omitting a statement about whether licenses being reported upon are one-time or recurring will unequivocally affect the users judgment. Leaving the user with the notion that 'they may be, or they may not be' does nothing for those relying on the report, and may unduly influence a user and prompt an improper decision. We can do better.
