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Fraud and Error as Object of Financial Audit
Keywords
Audit, Fraud, Error, Auditor independence
Abstract
This study analyzes the influence of the auditors in the abscission of fraudulent activities in Romania, the connection between the relation that might become between the auditor and the audited company, and also the way the quality of the audit depends on the audit report. The reason of initiation this research is represented by the importance of the existence of audit missions and of the final reports drafted by the auditors to reduce the fraud phenomenon which is the result of many gaps in the national economy and also in the international one. The research tries to highlight the importance the integrity of executive lead has in developing the normal activity of a company and in the remove of fraudulent activities. Studying this relation association of the auditor and client it is necessary to prove if this relation has a positive or negative influence over the auditor’s integrity. In the content of this study was used a sample made of 44 companies listed at Bucharest Stock Exchange from the Regulation Market and AeRO Market who owns various Standard actions, more specific, Aero Standard. Colleting the necessary information for the aim of the final results, was made of the financial situations of the company, form the annual report and from the audit report. Testing the 3 hypotheses from this study was made due to regression models. As a result of the analyze it has proven that in 2012, the lack of the executive leading integrity, represents an element which determines fraud. Between the existence of a social relation with the auditor and the leading client society and the impaired of the auditor’s integrity, it has been proven a positive association in 2012 and 2014, and a negative association in 2013. The research result over the auditor’s quality had prove that the audit report does not have an influence over the audit quality.