ІМПЛЕМЕНТАЦІЯ МІЖНАРОДНИХ СТАНДАРТІВ ВИЩИХ ОРГАНІВ АУДИТУ У ФІНАНСОВІ АУДИТИ РАХУНКОВОЇ ПАЛАТИ УКРАЇНИ

Abstract

The peculiarities of financial audits conducted by the Accounting Chamber of Ukraine according to a methodology that meets the requirements of ISSAI are explored. The Financial Audit Manual with detailed instructions, audit procedures, and templates of audit documentation, elaborated by the Accounting Chamber and international partners in 2019, is considered. The analysis of the experience of 31 European SAIs showed that most of SAIs do not publish audit manuals, in particular, only SAI of Albania, Georgia, Lithuania, Moldova, and Romania provided free access to financial audit manuals. The methodological recommendations for conducting the financial audit by the Accounting Chamber of Ukraine, adopted and published in 2015, cover all the issues that are outlined in such manuals of SAIs from those countries..Besides, the risks of providing open access to the Financial Audit Manual, elaborated by the Accounting Chamber of Ukraine were detected. They are the risks of fraud by officials of audited entities, not detecting a material risks by auditors, the use of intellectual property of the Accounting Chamber for commercial purposes by other entities and reputational risks due to breach of agreements with international partners involved in the development of the manual. The Financial Audit Manual was tested on six financial audits conducted by the Accounting Chamber in 2019 and main results are analyzed in the paper. Significant deficiencies of internal control, fraud risks and risks associated with accounting, budgeting and financial reporting software, and the need of improvement in accounting policies, internal control and workflow in all audit entities were identified. Additionally,, the audit results are presented in a user-friendly format tailored to the needs of decision- makers, with an emphasis on issues that require rapid response. Based on the conducted analysis, the conclusions about the low quality of financial and budgetary reporting of public sector entities and the systematic nature of identified problems and risks were made. Thus, the importance of financial audits was emphasized and the proposals for further improvement of this type of audit of the Accounting Chamber were elaborated. In particular, updating of the legislation and internal documents, usage of modern information technologies and software for audits, translation of ISSAI, training for staff, changes in personnel policy, improvement of the quality control system.