Auditor’s Legal Responsibility and its Effect on Accounting Profession.
The study investigate auditor’s legal responsibility and its effect on accounting profession. A survey research design was adopted in the course of the study. The study used a sample size of 49. The total population from which the samples size was derived are the population who of legally registered and practicing accounting firm.
Questionnaire was the main data collection instrument used for the collection of field data from the respondents. Field data were collected from respondent in three different states (Anambra state, Enugu and Akwaibom state) all in south east and south south Geo-political zones of Nigeira.
The field data collected from the respondent were all presented in tables and analysed using mean, standard deviation and analysis of variance(ANOVA).
The finding shows that auditor’s legal responsibilities such as detection of fraud, prevention of fraud and error etc have positive effect on accounting profession.
The result also indicated that auditors play vital role in auditing financial record of organization in other to balance financial account, check and detect financial fraud and also authenticate the correctness of financial information passed to it end users as one of the functions of the legal responsibilities of auditors in accounting profession.
It is recommended in the research that auditors should be conscious of their legal responsibilities in accounting profession during auditing activities, it was also recommended that auditors should be free from the influence of internal or external factors which could affect their profession negatively, hence, auditors should always authenticate financial statements in order to be credible in accounting profession.
Background to the Study
Auditing is a systematic examination of books, accounts, documents and vouchers of an organization to ascertain how far the financial statements present a true and fair view of the concern. It also ensures that the books of accounts are properly maintained by the concern as required by law.
Auditing is defined as a systematic and independent examination of data, statements, records, operations and performances (financial or otherwise) of an enterprise for a stated purpose.
In any auditing the auditor perceives and recognizes the propositions before him/her for examination, collects evidence, evaluates the same and on this basis formulates his/her judgment which is communicated through his/her audit report
Auditors’ auditing of a financial record provides third party assurance to various stakeholders that the subject matter is free from material misstatement.
The term is most frequently applied to audits of the financial information relating to a legal person. Other areas which are commonly audited include: internal controls, quality management, project management, water management, and energy conservation.
As a result of an audit, stakeholders may effectively evaluate and improve the effectiveness of risk management, control, and the governance process over the subject manner.
That an auditor has the responsibility for the prevention, detection and reporting of fraud, other illegal acts and errors is one of the most controversial issues in auditing, and has been one of the most frequently debated areas amongst auditors, politicians, media, regulators and the public (Gay et al, 2013).
This debate has been especially highlighted by the collapse of both small and big corporations across the globe.
The auditing profession in Nigeria has caught the media’s attention following financial scandals in some of the Nigerian banks such as Intercontinental Bank, Oceanic Bank, Afribank, and Bank PHB among others.
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