INDEPENDENT AUDIT SYSTEM AND ITS EFFECTS TO BUSINESS: THE COMPARISON INDEPENDENT AUDIT SYSTEM BETWEEN AZERBAIJAN AND TURKEY

Abstract

The economic growth of countries is undoubtedly based on capital accumulation and the increase in productivity that this requires. With the globalization process, international cooperation and capital flows have assumed an effective function in the economic development of countries. Both the production process, the commercial process, and the capital movements require a properly functioning legal system and a transparent business environment in which international accounting and auditing standards are effectively applied. Moreover, the concepts of control and significant influence come to the fore in determining which companies will be included in the consolidation. Although countries make an effort in order to adapt their national standards to International Financial Reporting Standards all of the countries have very specific control system and regulations. For this reason, differences emerge during the controlling process. Especially, the developing countries will encounter many challenges and have some similarities and differences during control process. In this study were evaluated comparisons of audit systems with theoretical and implementation between Azerbaijan and Turkey. Azerbaijan and Turkey auditing system develop year by year. And aim of the thesis is to find these challenges which auditors meet during the changing and adaptation with regulations of audit. This thesis includes Azerbaijan audit system compliance with international audit system, determination of what the audit deficiencies are and what the problems arise due to these deficiencies. Furthermore, according to the trade relations between Azerbaijan and Turkey, there are a lot of agreements between them. Due to a lot of agreements both these countries create difficult and different problems on control, so mention about Turkey auditing system and its problems which appear during auditing process were analyzed in this thesis as a one of the main parts. So, last parts are focus on answering comparison audit system differences between both country and which way auditors can defeated these specific problems. Implementation part of thesis is focus to ask questions from auditors in Azerbaijan and Turkey for answering questions about their point of views about control, the main problems they face in practice, what they implement in this case.