Abstract
The article deals with audit risk assessment in the National Audit Office of the Republic of Lithuania (hereinafter referred to as the NAOL). The audit risk features, classification, elements and the place of audit risk assessment are outlined. The text includes the legitimate environment of audit risk assessment in the NAOL and the evaluation of the NAOL Financial Audit Assurance Model. The Public Institutions Financial Audit Manuals of the United Kingdom and Sweden are taken into consideration. As a result of the survey; the NAOL Financial Audit Risk Assessment Guide is recommended.The principal conceptions dealt with in the article: audit risk and its assessment, Financial Audit Assurance Model, Financial Audit Risk Assessment Guide, classification, elements, the National Audit Office of the Republic of Lithuania.
Highlights
The Law on the Amendment of the Law on the State Control No IX-650 of December 13, 2001 issued a new mandate to the NAOL
The above described analysis of different audit risk definitions suggests four fundamental audit risk features: the presence of threat, the existence of audit risk in all the process of auditing, issuing an inappropriate audit opinion, the audit risk caused by gross misstatements (Scheme 1)
In the NOAL, audit risk assessment is based on the Financial Audit Assurance Model
Summary
The Law on the Amendment of the Law on the State Control No IX-650 of December 13, 2001 issued a new mandate to the NAOL. The NAOL has become an institution that carries out public audit instead of public control to help the nation effectively manage and use State budget and property, national funds and the funds of the European Union allocated to Lithuania (e.g., PHARE, ISPA, SAPARD) as well as other resources. The NAOL has started to focus on the risk-based audit in order to provide an audited body with a greater added value and to present a more exhaustive reporting both to the Seimas and to the European Commission. In conformity with the Public Audit Requirements, the state auditor must be at least 95 per cent confident that gross misstatements or irregular transactions do not occur in the audited financial statements. To meet the above-mentioned goal, the following aspects will be covered: 1. Audit risk features and classification
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