The Responsibility of the External Auditor and the Management of the Entity Being Audited with Relation Fraud and Error.

1585 Words Feb 23rd, 2012 7 Pages
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Essay Sample: Page 2
That’s why it is always required that auditors should maintain an objective, unbiased and independent mind, and give special attention to this area. The auditor should understand the entity’s internal control in its totality.

Fraud and other irregularities are different to errors as perpetrator intended deception and it could be a person that knows the operations and accounting systems of the company very much, and also the management may override internal controls and makes an effort to conceal the misstatements. It is important to note that whenever there is an accounting scandal or fraud has been committed. The question that always arise is “Where were the auditors?” when this unfortunate events occurs. According to . According to Arens,Elder, Beasly & Splettstoesser-Hogeterp (2007:288) auditors should maintain a questioning mind and set aside any previous trust in management’s integrity and honesty. Maintaining a questioning mind involves a critical evaluation of audit evidence presented to the auditors, they should diligently probe any audit issues and acquiring if necessary any additional evidence needed in the audit.

Assignment number :01

Course code: HONOUDK

Student number: 36894206

2.2 The responsibility of management

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