Adaptation of The Theory of Change for Improving Transparency of Financial Statements

The paper presents the main results of the research on the topic "Adaptation of the Theory of Change for improving Transparency in Financial Statements." Based on the theoretical analysis of the work in the field of financial accounting, auditing and internal control, the most significant factors and reasons for manipulation were selected. In addition, the most representative models were revealed. Data were analysed based on Messod Beniesh and Maria Roxas. In average 30% of companies have a suspicion of having manipulations with financial statements. Practical analysis of companies with signs of distortions in financial statements has shown that the main motive is the management's desire to increase the attractiveness of business in the eyes of the stakeholders. The main result of this work is the development of an algorithm. It helps to increase the attractiveness of the business without distortion of financial statements.