Review of Critical Accounting Estimates in the Context of Key Audit Matters

Ayca Zeynep Suer ()
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Ayca Zeynep Suer: Istanbul University, Faculty of Business Administration, Department of Accounting, Istanbul, Turkey

Muhasebe Enstitusu Dergisi - Journal of Accounting Institute, 2021, vol. 0, issue 65, 23-37

Abstract: In contemporary times, as factors of uncertainty are increasingly intensified, the amounts included in financial statements based on critical accounting estimate (CAE) disclosures are increasing. Due to the nature of accounting estimates and assumptions, with attending high levels of uncertainty, they are among the significant issues of focus for auditors and are expected to reflect key audit matters in audit reports. In this study, the Critical Accounting Estimates and Assumptions announced in the footnotes of the 2020 financial statements of companies included in the Borsa Istanbul 30 (BIST30) index and Key Audit Matters (KAMs) in the companies audit reports were examined. BIST30 companies were then classified according to sector and the CAE disclosures and assumptions reflected in the KAMs were determined. This study provide insight into the interrelation between CAE disclosures and KAMs, and also aims to be informative to financial statement users regarding to pervasive impact of CAE on financial reports.

Keywords: Critical accounting estimates; key audit matters; financial reports; audit reports (search for similar items in EconPapers)
Date: 2021
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Persistent link: https://EconPapers.repec.org/RePEc:ist:imeder:v:0:y:2021:i:65:p:23-37

DOI: 10.26650/MED.945442

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