TITLE:
The Adequacy of the Auditor’s Report in the Anti-Graft Age: A Forensic View
AUTHORS:
Stanley Ogoun, Terry Keme Zuode Odogu
KEYWORDS:
Adequacy, Auditor’s Report, Anti-Graft Age, Forensic Accounting
JOURNAL NAME:
iBusiness,
Vol.12 No.1,
March
11,
2020
ABSTRACT: One of the greatest evils ravaging the economies of
developing and developed countries in the information age is financial crime
with implications for the adequacy of the auditor’s report. Therefore, this
study is designed to qualitatively explore
and interrogate available literatures, towards ascertaining whether the
scope and content of audit and auditor’s report meet the information needs
and/or expectations of financial statement users in the anti-graft age, and to
examine whether the conventional audit report can furnish anti-graft agencies
with the required information that will enable them fight financial crimes. To achieve the above objectives, the
quasi-judicial, credibility, inspired confidence and policeman theory of
auditing were explored. Existing literatures revealed an expectation gap (in
assurance and content) between auditors and financial statement users. Related
literatures also suggest that conventional financial auditing tools and
methods, especially audit sampling are not adequate to detect and prevent fraud
and errors in the information age, and that
the conventional audit report cannot meet the information needs of
anti-graft agencies. The conclusion of the study is that conventional auditors, unlike forensic auditors, are mere
watch-dogs and not blood-hounds, and as a result cannot proactively detect,
prevent and investigate fraud. Consequently, it is recommended that forensic
auditing should be deployed in corporate settings to peruse and investigate the
facts behind the figures in reported corporate earnings as this would boost not
only investors’ confidence but the credibility of financial reports and that
conventional auditors should acquire investigative skills and technology.