Itygilova E.Yu.East Siberia State University of Technology and Management, Ulan-Ude, Republic of Buryatia, Russian Federation e_itygilova@inbox.ru
Importance The article investigates methodological aspects of audit risk assessment. Financial statements are one of the most important sources of information for business entities. However, financial statements may be misstated due to some objective or subjective reasons. Assessing their own risk, auditors should understand that audit risk directly correlates with the information risk for users of publicly available financial statements. Currently, it is especially important to develop and implement standardized methods in auditing firms' practices so to adequately assess the audit risk and improve the efficiency of auditors' performance. Objectives The research aims at methodological development of provisions on the classification of financial statements' distortions per reason of their origination, specifying the audit risk assessment model, which would allow considering factors that influence the quality of financial information and auditor's opinion. Methods The research is based on such formal and logic methods and cognition techniques, as analysis, synthesis, induction, deduction, comparison, and analogy. Results I propose a specified model of audit risk considering the factors of activities, events and restrictions. Conclusions and Relevance I provide a methodological development of provisions on audit risk assessment, considering factors that influence the quality of financial information and auditor's opinion. I determine that the distortion of financial statements may be construed as incorrect presentation of facts and states as a result of inaccurate recognition of activities and events in accounting records. This provision complies with the substance of business facts.
Keywords: audit risk, material misstatement, detection risk, financial statements
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