Auditing Is The Accumulation And Evaluation Of Evidence Accounting Essay

studying Is The Accumulation And Evaluation Of Evidence Accounting riseAuditing is the accumulation and evaluation of evidence or so information to determine and report on the degree of balance amongst the information and established criteria. Auditing should be through by a competent, independent party and notify the results to interested users. (Elder, and others, 2007, p .4) The purpose of champaign of operation is to enable the auditor to express an opinion whether the financial statements get a true and fair view in accordance with the determine financial reporting framework, and leave enhance the credibility of financial statements. Audits undersurface improve a comp alls efficiency and profitability by support the steering better understand their own work and financial system. The management, as well as the sh atomic number 18holders, suppliers and financers, is assure that the risks in the organization are well-studied, and effective systems are in place to handle them. Further more, audit so-and-so identify areas in an organizations financial structure that want improvement, and how to implement the proper changes and adjustments. It uncovers inaccuracies and discrepancies within an organizations records, which may be indications of weak financial organization or even national subterfuge, and cut off the risks. (Auditing, n.d.)At present embodied scandals and imposture continues to be a pervasive problem and is very common across the adult male. However these scandals and joke are so massive that every time many people especi in ally employees of the company draw back their jobs and investors are bearing from major losses in these incidents.Corporate player is any fraud perpetrate against a business and is used to include many different wrongs that may occur within a business. Corporate fraud takes many forms, including insider trading, embezzlement, false billing schemes, securities fraud and forgery, Asset misappropriati on fraud, Business luck fraud, Employment fraud, Short and long firm fraud, Employee fraud etc. Among the most dangerous forms of corporate fraud is known as long firm fraud, which occurs when a business is beed on legitimate grounds, and then mavin by certain unethical individuals toward a purpose of defrauding over a long time. (Corporate fraud, n.d.) It is difficult to conceptualize such(prenominal) scandals prior to the exposure as these involve complex methods for misusing funds, overstating revenues, understating expenses, etc. According to studies conducted in the united States, United Kingdom and Australia (2010) states that corporate fraud increased in the previous 12 months and economic conditions confuse worsened. The studies also found that the dollar amount lost to fraud also had increased as well. The count conducted by Association of Certified pseudo Examiners (ACFE, 2009) estimated that fraud cost U.S organizations 7 percent of annual revenues, or $ 994 billio n in losses based on 2008 gross domestic product. Although financial statement fraud less frequent, however it typically involved more than $ 2 million. Simultaneously, in the United Kingdom KPMGs Fraud Barometer found 1.3 billion of fraud in 2009. National head of forensic Gary Gill (2010) states that 2009 Australia KPMGs Fraud Barometer found million in major fraud cases. And they highlighted that although the number of cases remain same compared to first to second one-half of 2009, the value or cost of the fraud doubled. This could weaken investors and shareholders confidence.In order to prevent or reduce from corporate fraud auditors do have a duty to detect hallucinations and fraud hence auditors need to ensure that the financial statements are presented in true and fair view in accordance with the identified financial reporting framework. This investigate allow assist the auditors to find out what they can be done or what would be their responsibility to reduce the massive corporate fraud which, is rapidly spreading somewhat the world.Auditors obtain a reasonable assurance that financial statements are free of sensible misstatement caused by error or fraud. One of the challenges faced by the auditor in detecting fraud is the independence of the auditor. round companies management result not allow the auditor to act with integrity and exercise objectivity and overlord skepticism. The other challenge faced by the auditor is that the management does not provide sufficient information to detect the fraud. The auditors would not get sufficiency supporting documents to prove that whether the transactions are correctly recorded. Maintaining universal trust is also one of the challenges that auditors would face, hence the humankind has raised the question as to whether audit functions can be trusted, after financial statement fraud committed by big companies such as Enron, Tyco, and World.com. In order to prevent such problems from occurring, this rese arch has been conducted in order to help auditors to enhance audit quality, prevent and detect potential fraud before it is too late.Brief description of envision objectives.(i.e. backdrop of proposal, constructs used, limitations and significance)Andrew Marshal (2009) said that when it comes to corporate fraud, nowhere is safe, hence there are fraud scandals occurring everywhere in the world. CPA Journal (2008) estimated that a typical organization loses 5 percent of its annual revenues to fraud, or about $ 4,500 per employee each year. Furthermore the CPA Journal (2008) states that most frauds involve a lack of adequate internal controls (opportunity), the need to maintain an expensive lifestyle or pressure to meet goals (incentive), and the perpetrators lack of awareness that their actions are wrong (self-rationalization) or simple lack of integrity. However, investors expect auditors to give them absolute assurance for detecting material misstatement due to fraud. The majorit y of investors want from an audit absolute assurance the financial statements are free of all types of material misstatement. The main objective or the aim of this research testament be on how and what are the methods that auditors can contribute to minimize material misstatements from financial statements and reduce corporate fraud. The other objective of this research is to identify the difficulties in detecting corporate fraud and how to enhance audit quality. Besides that this research forget evaluate the gaps in internal controls and how auditors can come out with a financial statement without any biasness.Scope of the readingThe scope of this study will concentrate on auditors and their responsibilities towards the public. In addition it will focus on fraud awareness, fraud risk and the corporate governance in the organization. Furthermore this study will focus on the abilities and the knowledge which auditors should have to accomplish their obligations.Limitations of the S tudyThe limitations of this research will be the difficulty in collecting primary entropy hence this research will be conducted with face to face structured interviews and a survey questionnaire. The time limit for the interview may not be enough based on the availability of the participants, therefore interview has to be scheduled for the availability of participants.Significant of the StudyThis research will facilitate the auditors to maintain public trust and will enhance audit quality. By enhancing audit quality auditors can reduce the corporate fraud and make the companies trustworthy. When audit quality is compound auditors will be more responsible in detecting and preventing fraud. And auditors will bring to pass their work more carefully as a result the companies will not experience financial trouble or difficulties. This research will gather information about how corporate frauds can be reduced and auditors as a key people who needs this information to be applied in the corporate world to reduce corporate fraud.Brief description of the models/theories/concepts that will be used in this proposal.(i.e. consumer behaviourism model, CSF and etc.)This project does not require any concepts, theories or models to be used in the process of doing it.E schoolman research being carried out and other information, techniques being learnt.(i.e. literature what are the names of books you are going to read / data sets you are going to use)The books that this research will use are Audit and presumption Books, Internal and External Auditing books. Magazines, online articles and journals which are colligate to corporate fraud and auditors will be used. Journals include such as Audit disaster futures antidotes for the expectation gap by Fran M. Wolf, James A. Tackett and Gregory A. Claypool. And CPA journals such as Auditors responsibilities with respect to fraud a possible shift. In addition this research will use the Audit firms reports such as KPMG.Other rele vant sources includehttp//www.reuters.com/article/idUSTRE5AJ03S20091120http//www.reuters.com/article/idUSN1717856320100317http//www.bobsguide.com/guide/news/2009/Nov/20/Corporate_accounting_fraud_increasing_around_the_world.htmlhttp//www.kpmg.com/AU/en/IssuesAndInsights/ArticlesPublications/Press-Releases/Pages/Press-release-fraud-doubles-16-Feb-10.aspxhttp//www.irs.gov/compliance/enforcement/article/0,,id=213768,00.htmlhttp//www.anonymousemployee.com/csssite/sidelinks/corporate_fraud.phphttp//www.procurement.travel/news.php?cid=corporate-fraud-rises-employees-layoffs-economy.Mar-10.31http//www.emeraldinsight.com/journals.htm?articleid=868441show=htmlBrief description of the materials/methodologies needed by the proposal.(i.e. data collection methods, sampling, sample size and target group etc.)The data for this research is intended to be cover from Malaysia. Primary data will be stack away from listed companies and Audit firms of Malaysia. Data will be collected with the help of q uestionnaires and interviews. Face-to-face structured interviews will be carried out. The interview will be kept bypass to respect the time constrains of the participants, hence would not be exceeding 30 minutes. Where clarification is required, further followup interviews can be carried out over telephone or e-mail where necessary.A total of cl questionnaires would be prepared and distributed to the employees of listed companies of Malaysia and Certified Public Accountants (CPA) of Malaysia. The questionnaire would also be distributed to the shareholders for the listed companies of Malaysia and other employees who are working in financial institutions as well. The questionnaires would be more closed ended structured while there would be some open ended questions included as well. Most of the secondary data will be taken from online journals, Emerald, other websites and Athens database.G Brief description of the evaluation and analysis proposed for this project.(i.e. project deliv erables and hypothesis, correlational statistics test etc)Hypothesis of the ResearchThis research would benefit the Audit firms, public and private limited companies and shareholders and stakeholders of the public companies. This research not only benefits to Audit firms, public and private companies, but for the public as a whole. The hypothesis testing would show the effect and the changes of audit quality. This hypothesis testing would be the kindred between internal auditors and the external auditors, being independent between the internal auditors would assist the external auditors to work individually and detect fraud and prevent them re-occurring. In addition this research would expect that there is a relationship between internal control and the audit quality and relationship between audit ethics and audit procedures that the external auditors carried out.DeliverablesThe end result of this research would provide empirical information to all auditors and the top management of the company. Especially this information would facilitate the directors to come out with reliable financial statement to its users. This research will provide theoretical information to all the directors and to the management of the company in order to prevent the financial statements from misstatement and fraud. This information helps the company from losing billions of dollars per year from corporate fraud and will safeguard the shareholders interest and the stake holders of the company.H. allegory of how this project will benefit the future employabilityRelevance to IndustryAll the accounting and financial industries will benefit from this research. As an audit firm this research will help both enhancing the audit quality and will facilitate the new methods to detect fraud and will encourage new audit firms to perform the audit with due care. Auditing is one of the challenging works which assist the auditors to use their knowledge and experience and at the same time the new auditors will learn and gain experience in the audit field and would learn new methods on detecting frauds. This research would benefit all the corporations to minimize their corporate fraud cost.Significance to ModulesThis research is directly related to Audit and Assurance, Forensic Accounting. And also somehow this research is related to corporate governance as well.