Conclusion

Conclusion

Conclusion

The paper explored the auditors’ and users’ perceptions of the auditors’ responsibility for uncovering fraud, the performance of related auditing procedures, the nature and extent of fraud in Barbados, as well as the auditors’ response since Enron. The findings provided some valuable insights into how both parties view audit responsibilities and what their expectations are.
These results indicated that auditors strongly disagreed that they were responsible for uncovering fraud compared to the users’ strong view that they should be responsible. While fraud, in general, was not perceived to be a major problem in Barbados, there was a statistical significant difference between auditors and users on this point. Users showed moderate disagreement in fraud being a major problem compared to the strong disagreement of the auditors. In addition, both groups did not view fraudulent financial reporting as a major issue.
There was a general strong consensus by both groups that auditors should work to uncover related party transactions, assess internal controls, the work of the internal auditors, management’s characteristics and going concern issues, and ensure that audit findings are conveyed to the board of directors or audit committee, wherever applicable. However, users expected that auditors would actively search for illegal acts while auditors disagreed. Auditors and users agreed that auditing has improved since Enron, and both parties were fully informed on the issues surrounding the collapse of Enron. It was also found that organisations with strong internal controls, internal auditors and audit committees were better equipped to deal with fraud in any form.
Users in Barbados may need to be better informed as to how auditors view their role. Education may be the key in solving part of the problem, by closing the “misunderstanding gap” although the “expectation gap” may still exist (Porter, 1997). In addition, a precise and detailed engagement letter must, inter alia, contain all the relevant conditions necessary for the engagement, the services provided and the responsibilities of both parties. This is an excellent opportunity for the auditor to inform the client and to explain to the shareholders at the annual general meeting (rather than to the directors) that the prevention and detection of fraud rests with the company.
Makkawi and Schick (2003) suggested two approaches that auditors should adopt to aid in fraud detection. First, they argued that auditors need to “audit smarter” because they operate in a fixed fee environment, which limits the fees, that clients are willing to pay. This can be accomplished by the need for auditors to be more aware context in which the audit occurs and the fact that the nature and concentration of fraud varies by industry. Second, the authors suggested that auditors should exercise greater scepticism and rigorous assessment of management’s integrity, which are also required by SAS No. 99.
The fact that auditors in Barbados do not view the detection of fraud as their responsibility, but rather see their role as expressing an independent opinion on financial statements is an indication that they still need to be aware that undetected fraud could distort their findings and affect the reliability of their reports. Above all, from an ethical viewpoint, external auditors as well as internal auditors should report any suspicion of fraud rather than remain silent.
The findings from this research show a favourable picture on certain issues as audit respondents may have attempted to portray the profession in a favourable light. Future research may consider sending a large-scale self-administered questionnaire to remove any potential bias. Further research into this area could also be undertaken to investigate the functional and operational aspects of auditing for fraud.

Sumber : https://student.blog.dinus.ac.id/blogtekno/seva-mobil-bekas/