Analysis of Key Audit Matters Disclosed in Audit Reports For Selected Companies Listed on Newconnect Market in Poland

The audit report prepared by an independent expert should guarantee that the financial information that companies provide to the market are reliable and useful for stakeholder’s decisions. Few years ago, the format of audit report has been changed. ISA 701 Communicating Key Audit Matters in the Independent Auditor’s Report requires auditors to disclose “areas of higher assessed risk of material misstatement, significant auditor judgements relating to areas in the financial statements that involved significant management judgment and significant events or transactions that occurred during the period” (IAASB, 2015). The research paper is based on the content analysis of the expanded audit report. The results obtained based on a sample of audit reports prepared for companies listed on NewConnect market in Poland can contribute to the debate on the utility of the audit report. The article reports the results of the authors’ own research, based on the analysis of the auditors’ audits carried out in relation to the financial statements of selected companies listed on the NewConnect market  in 2017-2019. Research methods used in the article are the analysis of statutory auditors’ reports, comparative analysis of KAM in companies from the same industries as well as induction method. The research was conducted on the basis of data from the financial and substantive statements of selected companies and inductions.  An analysis of the KAM disclosed for the presented research sample of companies listed on NewConnect shows that the statutory auditors provide a justification for the choice of the risk area concerned, as well as detailed examination procedures that may form the basis for a better understanding of the financial condition of the audited companies.