METHODS FOR EVALUATING THE INTERNAL CONTROL SYSTEM OF AN ECONOMIC ENTITY DURING THE AUDIT PROCESS

Abstract

This article examines the theoretical and methodological foundations and practical methods for evaluating the functioning of an economic entity's internal control system during an audit. It substantiates the decisive role of internal control assessment in determining the sufficiency of audit evidence, the level of audit risk, and the nature, timing, and extent of audit procedures. The study comparatively analyzes the COSO conceptual framework, INTOSAI internal control standards for the public sector, the international professional standards of the Institute of Internal Auditors (IIA), and risk-based, test-of-controls, questionnaire, matrix, scoring, and digital assessment methods. Particular attention is paid to digitalization and the use of artificial intelligence in state audit and financial control in the context of Presidential Decree No. PF-252 of the Republic of Uzbekistan dated 18 December 2025. The results show that no single method provides a sufficiently comprehensive and objective assessment in isolation; therefore, a combined multi-stage approach is required. Practical recommendations are proposed for economic entities and audit organizations to standardize internal control assessment, expand data analytics and continuous auditing, and improve auditors' digital competencies.