Special Considerations in Financial Statement Audit of Public Sector Entities

The trend of public sector expansion observed in recent years makes the issue of developing an audit aimed at confirming the reliability of the financial statements of public sector organizations relevant. At the same time, a number of International Standards on Auditing (ISAs), in accordance with which audits are carried out in Russia, contain special requirements and recommendations regarding the audit of public sector entities. The purpose of the work, therefore, is to identify problematic issues in auditing the financial statements of public sector entities in accordance with the requirements of ISAs. The paper systematized ISA requirements for the audit of financial statements of public sector organizations, analyzed regulatory and literary sources, on the basis of which some problems were identified, in particular, related to the assessment of risks of significant distortion, the choice of benchmarks for setting materiality, the implementation of analytical procedures, and interaction with those charged with governance (TCWG), which are not part of the entity. A recommendation was proposed to determine TCWG when adopting an assignment to audit the financial statements of a public sector entity.