Staff Accounting Bulletin 108 provides guidance for correcting financial statement misstatements. The SAB discusses the consideration of prior year’s misstatements when quantifying misstatements in the current year’s financial statements. In this SAB, the SEC identified two methods to quantify current-year misstatements: the rollover approach and the iron curtain approach. The rollover approach quantifies a misstatement using the amount of error in the current year’s income statement. This approach can result in accumulation of significant misstatements on the balance sheet that are deemed immaterial because the amount each year is relatively small. On this other hand, the iron curtain approach quantifies a misstatement based on the effects of correcting the misstatement existing in the balance sheet at the end of the current year. However, this approach does not consider the correction of prior year misstatements in the current year. Through SAB 108, the SEC requires registrants to quantify misstatements using both approaches. If either method results in a material error, the financial statements must be adjusted. This SAB relates to materiality because prior to SAB 108, an error may have been immaterial in relation to the balance sheet, while it may have been material to the current year income statement. SAB 108 standardized the methods used to determine materiality for a prior year misstatement. SAB 99 expressed the SEC’s views that materiality must be decided on both quantitatively and qualitatively, and SAB 108 further described the methods that were to be used to decide if a misstatement was