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Risk of Material Misstatement in Fluctuated Economic Environments: The Case of Greece

Author

Listed:
  • Stamatios Dritsas
  • George Petrakos

Abstract

The aim of this paper is a) to investigate the relationship between the business risk and the risk of material misstatement at an overall financial level and b) to determine the dependencies between the risk of material misstatement and selected risk factors affecting pervasively the financial statements and many assertions. The study was based on data collected from a statistical survey among experienced statutory auditors employed by the five largest international audit firms in Greece. The research suggests a statistically significant relationship between the business risk and the risk of material misstatement at the overall financial statements level. Furthermore, although the majority of the survey participants believes that the recent financial crisis in Greece affected their assessments on going concern risk and the risk linked to accounting estimations substantially, the dependencies between those two risks and the risk of material misstatement at an overall financial statements level are not validated by the survey data.

Suggested Citation

  • Stamatios Dritsas & George Petrakos, 2018. "Risk of Material Misstatement in Fluctuated Economic Environments: The Case of Greece," International Business Research, Canadian Center of Science and Education, vol. 11(6), pages 243-248, June.
    • Handle: RePEc:ibn:ibrjnl:v:11:y:2018:i:6:p:243-248
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    References listed on IDEAS

    as
    1. Reiner Quick, 2012. "EC Green Paper Proposals and Audit Quality," Accounting in Europe, Taylor & Francis Journals, vol. 9(1), pages 17-38, June.
    2. Luc Quadackers & Theodore Mock & Steven Maijoor, 1996. "Audit risk and audit programmes: archival evidence from four Dutch audit firms," European Accounting Review, Taylor & Francis Journals, vol. 5(2), pages 217-237.
    3. Quick, Reiner, 2012. "EC Green Paper Proposals and Audit Quality," Publications of Darmstadt Technical University, Institute for Business Studies (BWL) 60560, Darmstadt Technical University, Department of Business Administration, Economics and Law, Institute for Business Studies (BWL).
    Full references (including those not matched with items on IDEAS)

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    More about this item

    Keywords

    audit risk; financial statements; risk assessment; risk of material misstatement;
    All these keywords.

    JEL classification:

    • R00 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General - - - General
    • Z0 - Other Special Topics - - General

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