Audit of Liabilities of Business Entities: Theoretical and Methodological Aspects

Abstract

The aim of this article is developing theoretical principles and elaborating methodological approaches and practical recommendations to improve the methodology for auditing liabilities of business entities. The article uses the following research methods: induction and deduction, analysis and synthesis, cause and effect relationship, statistical analysis. Analysis and research of relevant scientific and practical literature, as well as standards which regulate conducting an audit of the financial statements of business entities, allowed to define the concept of audit methodology in general, as well as to determine the nature and content of the methodological support for auditing liabilities of business entities. The relationship between the tasks of the auditor in an audit of liabilities of business entities and sources of information is generalized. Achievements regarding the formation of the methodology for auditing liabilities of business entities at the present stage of development of audit activities in Ukraine, in particular, approaches to the definition and assessment of audit risk in connection with the materiality level, are systematized. As a result of the analysis of the scientific papers and domestic and international legislation, the methodology for auditing liabilities of business entities is improved by developing and justifying guidelines for minimizing audit risk when verifying liabilities, based on the proposed predictive assessment model of acceptable audit risk during an audit of the obligations of business entities. Practical implementation of the research results will allow optimizing the work of auditors in conducting an audit of the financial statements of business entities. In this regard, it makes sense to focus the further research on considering best practices of developed countries and global trends in the field of auditing liabilities of business entities.

Keywords

• audit
• audit of liabilities of business entities
• audit methodology
• methodological support of audit
• audit risk
• audit risk assessment