| Abstract [eng] |
SUMMARY The main purpose of this master is to identify the key audit risks in different industries companies in order to provide guidance to improve the audit risk assessment process. First of all, audit risk definition and different audit risk models, audit risk components` assessment, the connection of audit risk assessment with clients` industry understanding, the concept of key audit matters were revealed by reviewing literature of these topics. Then, the qualitative document content analysis method was applied in order to investigate what are the main audit risk of different industries companies based on information about key audit matters provided in Lithuanian publicly traded companies reports. It can be concluded that audit risk is unavoidable but it should be minimized to an appropriate level by auditor. Auditor has to asses all components of audit risk model: inherent risk (the risk which exist assuming the client does not have any related internal control), control risk (the risk that material misstatement will not be prevented or detected by the client's internal control system) and detection risk (the risk that auditor's procedures will not detect material misstatements when in fact such misstatements exist). Audit risk assessment is closely related to clients` industries understanding – the more knowledge auditor has about companies` industries in which they are working, the more precise audit risk assessment and audit procedures are performed. Key audit matters, provided in auditor opinion, disclose matters which were most risky and for which auditors focused on during the current year audit. Research results of 28 companies` auditor opinions (2016-2019) showed that as main risks auditors specified not only standard revenue recognition risk but different assets valuation aspects depending in which industries the client is operating. Therefore, audit companies should reconsider whether they have sufficient internal resources and specific knowledge about client industries before accepting new clients in order to minimize main audit risks till acceptable level and appropriate auditor opinion could be provided. The research of this thesis could be improved by applying additional research methods such as interview/surveys in order to find out which main audit risks of different industries companies are described by auditors and compare the results with key audit matters provided in different companies auditors opinions. |
