Fraud Affects on Auditing: Some Critical Scenario

Abstract

The key factor in enhanced credibility is the perception of external stakeholders that the external<br><br>auditors judge to financial statements providing through the management. In recent years<br><br>corporate scandals were happened, so investors demanding that auditors should be as an honest<br><br>judge. Investors expect the auditors to detect fraud. The auditors although they view their role as<br><br>bringing credibility to financial statements, know that because of scope and limitation of their<br><br>responsibility cannot detect all kinds of fraud. However, may this question arise that why<br><br>auditors take the position that they are not responsible for fraud detection: therefore it created<br><br>expectation gap. In this paper the authors believe that at first legislators should be expand<br><br>auditor responsibility for fraud detection, second auditors should do the best job, regarding fraud<br><br>detection, therefore it will be reduce audit gap.