Which factor is NOT considered in determining materiality for SOC 1?

In the context of determining materiality for a SOC 1 report, user entity discretion is not explicitly considered as a factor. Materiality in SOC 1 assessments primarily revolves around quantitative and qualitative factors along with the inherent risk of material misstatement.

Quantitative factors refer to measurable aspects, such as financial thresholds, that can indicate the significance of a misstatement in financial reporting. Qualitative factors involve the nature of the information and the context in which it might be material—certain events or transactions may be material even if they do not meet strict numerical thresholds. The risk of material misstatement encompasses the likelihood that a material error may occur, affecting the financial statements.

User entity discretion, however, relates more to how user organizations apply the information provided in SOC 1 reports rather than being a parameter for measuring materiality itself within the audit process. Therefore, while user discretion may influence how the information is perceived or utilized, it is not part of the defined factors for assessing what constitutes materiality in the context of SOC 1 compliance.