ADAPTATION OF THE METHODOLOGY FOR AUDITING SETTLEMENTS WITH SUPPLIERS IN THE CONTEXT OF MARTIAL LAW AND DIGITALIZATION

Abstract

The article substantiates the conceptual foundations and practical recommendations for improving the methodology for auditing settlements with suppliers, which is crucial for confirming the reliability of financial reporting of enterprises in conditions of growing economic uncertainty and dynamic transformations in the business environment. The emphasis is on the need to adapt modern auditing practices to the radical changes caused by two leading factors: the state of martial law in Ukraine and the intensive introduction of digital technologies into accounting and auditing processes. The impact of martial law on the organization of the audit process, in particular on the effectiveness of checking settlements with suppliers and contractors, has been studied. It has been established that the introduction of temporary tax relief, in particular simplified requirements for documentary evidence of business transactions, increases the risk of significant distortion of financial statements and reduces the reliability of traditional audit evidence. In this regard, the need to adapt audit procedures in essence has been justified, which involves enhanced monitoring of the registration of tax invoices, detailed verification of the compliance of business transactions with accounting records, and assessment of the correctness of the reflection of tax liabilities. Particular attention is paid to the impact of digitalization processes on the organization and methodology of auditing. On the one hand, digital technologies contribute to a significant reduction in the time required to collect, process, and analyze large amounts of data, ensuring the efficiency and consistency of audit procedures. On the other hand, the spread of information systems and automated accounting solutions is accompanied by an increase in control risks, including cyber threats, unauthorized access to data, and potential breaches of information integrity. In this regard, it is proposed to revise the classic model of audit risk, taking into account digital realities, to integrate computerized audit technologies for mass data verification, detection of anomalies and potential signs of fraud, and to use analytical algorithms to predict risky transactions. Practical recommendations were provided on the application of adapted external confirmation procedures, which involve the active use of electronic means of communication, analysis of subsequent payments, and digital journals of mutual settlements. This approach minimizes the impact of logistical, communication, and organizational constraints caused by martial law, improves the accuracy of audit assessments, and ensures a more comprehensive verification of the reliability of financial statements. Thus, the results of the study emphasize the need for a comprehensive review of traditional audit procedures in light of current economic, technological, and legal challenges, as well as the development of a methodology capable of ensuring high-quality audits and effective risk control in conditions of martial law and active digitalization of the accounting and auditing environment.