Title

Auditors’ perceptions of responsibilities to detect and report client illegal acts in Canada and the UK : a comparative experiment

Document Type

Journal article

Source Publication

International Journal of Auditing

Publication Date

7-2004

Volume

8

Issue

2

First Page

165

Last Page

184

Keywords

illegal acts; auditing standards; auditor respon-sibilities; detection and reporting

Abstract

This paper investigates the theme of the role and influence of auditing standards on auditing practice by means of a comparative case study focused on two different standard setting regimes. Specifically, the Canadian and UK standards concerned with the detection and reporting of client illegal acts are considered. Fifteen short vignettes are developed each describing an illegal act and reflecting the distinctive factors highlighted by the respective auditing standards. We find that the regulation of the auditing profession through the mode of auditing standards does have an identifiable impact on auditor behavior. The impact of standards on auditors’ perceptions of their responsibilities in the area of illegal acts is clearer for detection than it is for reporting. Additionally, auditors continue to perceive a clear distinction between fraud and other illegal acts and recognize a higher degree of responsibility for illegal acts involving fraud than for others. At the other end of the spectrum auditors do recognize some degree of responsibility in connection with illegalities that do not fall within the ambit of auditing standards. Auditors are also influenced in their judgments on the general nature of an illegal act rather than on how the illegality fits the framework adopted by the appropriate auditing standard.

DOI

10.1111/j.1099-1123.2004.00088.x

Print ISSN

10906738

E-ISSN

10991123

Publisher Statement

Copyright © Blackwell Publishing Ltd 2004

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Full-text Version

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Recommended Citation

Fraser, I. A. M., & Lin, K. Z. (2004). Auditors’ perceptions of responsibilities to detect and report client illegal acts in Canada and the UK: A comparative experiment. International Journal of Auditing, 8(2), 165-184. doi: 10.1111/j.1099-1123.2004.00088.x