The role of audit in detecting accounting fraud : the perspective of Poland

Abstract

PURPOSE: The objective of this article is to analyze how can auditors' actions impact the reliability and credibility of financial statements. As well an analysis of the role of auditing in detecting financial frauds.

DESIGN/METHODOLOGY/APPROACH: This article formulates the following research problem: How do auditors' actions help detect financial fraud? Have financial market regulators learned from financial scandals to which auditors contributed? Corresponding to this research problem the research hypothesis was formulated: Changing requirements relating to both the audit process and audit firms have a positive impact on the quality of financial information and may contribute to improving the protection of investors and other users of financial information. The study employs an analysis of existing scientific literature, norms, and standards related to auditing and accounting field. The analyzed sources include books and scientific articles aimed at understanding the theoretical foundations of auditing and accounting , as well as identifying best practices and challenges in this field.

FINDINGS: Modern corporations are large organizations with highly complex processes. The increasing role of auditing has a positive impact on these organizations by enhancing their ability to detect fraud and abuse. However, it should be noted that creating an effective internal audit system is a complex, time-consuming, and costly process. The services of the most recognized statutory auditors are also expensive, and not all organizations are able or willing to incur these costs. Many organizations would find it difficult to implement these audit processes if they were not required by legal regulations and financial market standards.

PRACTICAL IMPLICATIONS: The study’s findings can provide company management with crucial information regarding audits and the applicable audit regulations. However, to further assess the impact of auditing on finance and accounting, additional analyses and studies are necessary.

ORIGINALITY/VALUE: The article presents an approach to the importance of auditing, the tools used, selected auditing techniques, and the legal regulations introduced after the 2008 crisis, with particular consideration of the Polish perspective.