HEC-Ecole de gestion de l'Université de Liège
HEC-Ecole de gestion de l'Université de Liège

The impact of internal control in the independent audit of financial statements

Degeest, Amélie ULiège
Promotor(s) : Colson, Christophe ULiège
Date of defense : 5-Sep-2018/11-Sep-2018 • Permalink :
Title : The impact of internal control in the independent audit of financial statements
Author : Degeest, Amélie ULiège
Date of defense  : 5-Sep-2018/11-Sep-2018
Advisor(s) : Colson, Christophe ULiège
Committee's member(s) : Van Caillie, Didier ULiège
Kamto Kenmogne, Marius ULiège
Language : English
Keywords : [fr] Internal control – External audit – Independent audit – ISA – Audit strategy – Tests of controls
Discipline(s) : Business & economic sciences > Accounting & auditing
Institution(s) : Université de Liège, Liège, Belgique
Degree: Master en sciences de gestion, à finalité spécialisée en Financial Analysis and Audit
Faculty: Master thesis of the HEC-Ecole de gestion de l'Université de Liège


[fr] Influenced by audit failures and the recent crisis of 2008, the audit world has been subject to changes. One of them being the introduction of the ISA methodology in Belgium for all audit after December 2014. The introduction of the norm ISA has brought the audit approach by the risks. The approach by the risks imposes auditors to get a comprehension of internal control for the purpose of the risk assessment. In addition, the comprehension of internal control system creates a possibility for the auditor to rely on controls in order to get reasonable assurance on the financial statements by testing their operating effectiveness.
The purpose of this thesis is to understand on the field the impact internal control can have on the external audit of financial statements in the Liège region. After conducting ten interviews with professional auditors, it results that internal control is recognized by all as fundamental in the audit process and they could not do a quality audit without getting a comprehension of it. The results obtained from the analysis showed that the preliminary assessment of internal control provides an important basis for designing and implementing responses to cover the assessed risks. It influences on the sample size and the percentage of the performance materiality were of the most cited examples. It also results from the interviews, that the audit control-reliance strategy is not seen as reducing the audit time and cost but is seen as valuable for reducing the substantive procedures and splitting the works on the whole audit year. However, the results also indicate that in the majority of the audit, auditors are relying exclusively on substantive procedures due to globally low level of operating effectiveness of controls. The lack of segregation of duties and of documentations, the weak ICGT, the objectives constraints of management, the change in personnel are among the obstacles cited during the conversations with auditors that prevent them to rely on internal control. Nevertheless, with the high computerization and the high level of transactions of some companies, testing the operating effectiveness of control became essential in the audit of those enterprises and is recognized by all as inevitable to have reasonable assurance on the figures. It is also concluded that internal control has rarely a direct impact on the audit opinion but can appear in the reasons for a modified opinion related to a particular cycle.



Access TFE - Amélie DEGEEST.pdf
Size: 693.03 kB
Format: Adobe PDF


  • Degeest, Amélie ULiège Université de Liège > Master sc. gest., à fin.


Committee's member(s)

  • Total number of views 23
  • Total number of downloads 10

All documents available on MatheO are protected by copyright and subject to the usual rules for fair use.
The University of Liège does not guarantee the scientific quality of these students' works or the accuracy of all the information they contain.