Original scientific paper

Frauds from the Perspective of External Auditors – Croatian Experiences

Robert Zenzerović orcid.org/0009-0007-6959-6091 ; Juraj Dobrila University of Pula, Faculty of Economics and Tourism “Dr. Mijo Mirković, Pula, Croatia
Dolores Pušar Banović orcid.org/0000-0002-9347-9107 ; University of Applied Sciences RRiF, Zagreb, Croatia
Sanja Jolić orcid.org/0009-0009-4012-1142

Abstract

Financial frauds and manipulations in financial statements often occur and pose a significant problem for organizations, capital owners, tax authorities, creditors, potential investors, and society. In that sense, the role of external auditing is invaluable, precisely aimed at protecting the interests of all the stakeholders mentioned. External auditing primarily examines the objectivity and accuracy of fundamental financial statements. Timely detection of financial fraud and manipulations in financial statements are among the key tasks of external auditors. The purpose of this paper is to broaden the existing knowledge about fraud and how organizations respond to them from the perspective of external auditors. In addition to the research on the role and significance of external auditing in detecting financial frauds and understanding the process of uncovering financial frauds within companies, a comparison of the role and activities of internal auditing in the same process was also conducted. The primary observation derived from comparing the research outcomes of internal and external auditors reveals notable distinctions in the occurrence of fraud they detected, vulnerability to manipulation of financial statements, the nature of that manipulation, and the specific department where fraud perpetrators are employed

Keywords

financial fraud; external auditing; internal auditing; tools; activities; and participants in detecting financial frauds; fraud perpetrators

Hrčak ID:

313910

URI

https://hrcak.srce.hr/313910

Publication date:

31.12.2023.

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