When Grant Thornton asked US chief financial officers (CFOs) and comptrollers if the auditor’s responsibility was to detect ‘any or all fraud’, an overwhelming majority, at 83.26%, said ‘no’, while 16.74% said ‘yes’.
To the question ‘do you think it is possible for auditors to detect any and all corporate fraud (even if they think they are being intentionally misled by management with respect to a company’s financial health), 83.26% of respondents replied ‘no’ and 16.74%, ‘yes’.
Perhaps more troubling, 62% of respondents believed it would be possible to intentionally misstate their financial statement to their auditor, against 37.10% who did not.
Furthermore, the eXtensible Business Reporting Language (XBRL) approved by the US Securities and Exchange Commission last May is far from reality as almost half of CFOs, at 47%, were not even aware of the new standard for tagged business information and only 0.45% expected to file in XBRL format for the 2007 financial year.
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