Materiality as a Process | The Post Pounder Test: Applying Materiality in Sweet Grass County

When Sweet Grass County’s road department purchased a post pounder for just over $5,000, it was added to the County’s capital asset schedule and set up for depreciation, just as policy required. But the purchase raised a broader question for the County’s finance officer, Vicki Uehling: Why are we spending time and precision on assets like this?

Sweet Grass County, in south central Montana, serves fewer than 4,000 residents and had long used a $5,000 capitalization threshold. Over time, the County saw that the policy captured many small assets that added little to the overall value reported in the financial statements and, more importantly, little to its ability to make sound financial decisions.