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.

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