What Has Been the Responsibility of Audit in Financial Scandals?

Abstract

This paper is a reflexive study dealing with fraud and audit –issues that will determine

the responsibility of audit regarding financial scandals. A methodology of analysis of actual cases

of fraud was implemented to achieve this objective. Collection of information was then made, and

authors based their critical and interpretative reflections both on the analysis of control and auditing

theory and on the international standards. Finally, some considerations are presented concluding,

on the whole, that if an adequate implementation of audit procedures is followed, fraud is not the

responsibility of the auditor, given: 1) the inherent limitations of his role; 2) the audit technical

aspects in the scope level, and 3) that fraud prevention is the responsibility of administration, as

stated explicitly by the ISA 240