Itygilova E.Yu.East Siberia State University of Technology and Management, Ulan-Ude, Republic of Buryatia, Russian Federation e_itygilova@inbox.ru
Importance The research focuses on developing the conceptual provisions on categories and substance of financial reporting misstatements. I outline their classification in terms of reasons, i.e. actions and events that take place in the financial and operating activities of entities, and implications for financial statements. The methodological classification of financial reporting misstatements, in terms of the quality of accounting and audit, helps sufficiently understand the substance of financial reporting misstatements as an audit evaluation category. It is important to classify financial reporting misstatements as it allows devising an approach to finding such misstatements, identifying them and assessing their effect on auditing and financial reporting data, form of the auditor's opinion and type of its modification. Objectives I examine the methodological classification of financial reporting misstatements so to formulate conceptual provisions on identification of financial reporting misstatements. Methods The research employs formal and logic methods and cognition techniques: analysis, synthesis, induction, deduction, comparison, and analogy. Results I propose a new classification of financial reporting misstatements per reasons and implications for financial statements. Conclusions and Relevance Having studied the conceptual substance of financial reporting misstatements, I conclude that the classification of misstatements helps understand their nature and implications, thus complementing the conceptual understanding of an initial capability of audits to determine the degree of misstatements in financial statements. The outcome of the research may be applied by accountants and auditors for scientific, educational and practical purposes.
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Handbook of International Quality Control, Auditing Review, Other Assurance, and Related Services Pronouncements. Volume 1. International Auditing and Assurance Standards Board, 2014 Edition.
