Statutory Auditors’ Role on Corporate Accounting Corruption: Users’ Perceptions

Abstract

Based on audit evidences collected from internal and external sources, statutory auditors conduct a rigorous audit procedure and form their opinion on aforesaid issues and state whether financial statements exhibit ‘true and fair’ view of the business operation in the report^. In present day, economic environment, greed and tremendous urge to survive in the cut throat competitions induce some company management to breach accounting laws and manipulate financial statements. Accounting irregularities in the financial statement eventually comes under regulatory radar leading to company’s demise affecting most of its stakeholders. The scandal then becomes a topic of discussion in media and other business forums. Since 1990, our Globe has been witnessing such corporate accounting scandals times without number in different countries (e.g. Scandal at Polly Peck, Enron, Parmalat, Royal Ahold, Satyam, etc.). These scams across the Globe proved auditors’ failure in performing their duties sincerely. Every time a scandal is revealed, question on auditors’ sincerity and independence is raised automatically. Stakeholders are betrayed and professional integrity and ethical responsibility of the auditors are questioned.  In view of this, the current study makes an exploration on the relevant issues affecting statutory auditors’ role on corporate accounting corruption based on occupation of respondents.

Keywords: True and Fair view, stakeholders, corporate accounting corruption, statutory auditors’ independence

DOI: 10.7176/RJFA/16-1-04

Publication date: January 30th 2025