Financial auditing and financial reporting for Romanian state-owned companies – modified opinions and observations
Vol. 17, No. 4/2018 , p513..531
Author(s):
Costel Istrate
Keywords:
state-owned companies, audit reports, modified opinions, emphasis of matter paragraph, financial reporting
Abstract:
Starting with 2016, the Romanian authorities decided that 17 state-owned companies should use IFRS in their individual financial statements. The objective of this paper is to analyse how these companies have applied the accounting standards – before the transition to IFRS (2010-2017) – through the observations included in the reports delivered by the financial auditors. The main findings are: the presence of Big 4 auditors is quite limited, but in line with the situation of others categories of Romanian companies (especially the listed companies); the modified opinion are, by far, the most frequent (more than 78%). The main justifications of the modified opinions are the non-observance of the accounting rules on the provisions, followed by problems in the measurement of the assets/liabilities, and the consequences of the prudence principle. Emphasis of matters paragraph is also very present in the audit reports: the main observations in these paragraphs is about the going concern matters ant about the dependence of the state owned companies on the decisions of some public authorities.
Download:
http://online-cig.ase.ro/jcig/art/17_4_1.pdf
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